LNG Bunker Snapshot: Singapore’s price drops amid soft demand and ample supply

Rotterdam’s LNG bunker price has slipped on expectations of milder European weather, while Singapore’s has declined in response to weak broader Asian demand and abundant regional LNG supply.

Weekly changes in LNG bunker prices:

• Rotterdam down by $36/mt to $630/mt
• Singapore down by $22/mt at $670/mt

Rotterdam

Rotterdam’s LNG bunker price has fallen for the second week in a row, reaching $630/mt. The decline is mainly linked to a 7% drop in the front-month Dutch TTF Natural Gas contract, a key benchmark for European gas prices.

The TTF price has fallen “due to stable supplies from Norway and forecasts of rising temperatures in northwestern Europe,” according to the Japan Organization for Metals and Energy Security (JOGMEC).

“The prospect of a mild start to winter continues to weigh on both, the day-ahead market and futures,” noted Mind Energy (formerly Energi Danmark).

“Expectations of milder weather in early December have also put pressure on prices,” echoed ANZ Bank senior commodity strategist Daniel Hynes.

EU underground gas storage stood at 76.1% as of 28 November, down from 79.6% the previous week, and 12.2% lower than the same period last year, according to Gas Infrastructure Europe.

“In addition, hopes on a potential peace in Ukraine provided additional downward pressure on prices,” added Greg Molnár, gas analyst at the International Energy Agency (IEA).

Singapore

Singapore’s LNG bunker price has fallen by $22/mt over the past week, pressured by “ample end-user inventories and weak demand” in Northeast Asia, according to JOGMEC.

The drop reflects a $0.38/MMBtu decline in the NYMEX Japan/Korea Marker (JKM) benchmark over the week, taking the front-month contract to $11.09/MMBtu ($577/mt).

“Ample LNG supply, together with relatively weak Asian demand, continued to provide downward pressure on Asian spot LNG prices,” IEA’s Greg Molnár commented.

“North Asia LNG prices extended recent losses, dropping to their lowest level in a month amid weak demand. China’s LNG purchases are on track to drop for a 13th straight month in November,” ANZ Bank’s Daniel Hynes added.

“Buying (LNG) by Japan and China remains subdued… US tariffs are keeping industrial activity in markets, such as China and South Korea, muted,” he explained.

Singapore’s previous $26/mt premium over Rotterdam has widened to about $40/mt within a week.

Other LNG bunker news

Swiss engine maker WinGD has partnered with marine technology company Panasia to upgrade existing LNG dual-fuel engines with its latest fuel-saving and emissions-reducing technologies.

Meanwhile, Egypt’s Ministry of Petroleum and Mineral Resources and the Suez Canal Authority have signed an agreement to build an LNG liquefaction and supply terminal in the Raswa area of Port Said.

Elsewhere, South Korea’s HMM has placed an order with HD Hyundai for eight 13,400-TEU LNG dual-fuel container ships, while Malaysian logistics firm MISC, through its subsidiary AET, has ordered two LNG dual-fuel vessels.

By Tuhin Roy

Please get in touch with comments or additional info to news@engine.online