LONDON: Spot liquefied natural gas (LNG) prices in Asia dropped this week as no substantial demand emerged to offset an oversupply of cargoes in the market.
The LNG price for northeast Asia delivery in September is estimated at $4.25 per million British thermal units (mmBtu), a 35 cent drop from the previous week.
The October delivery price is estimated at $4.95 per mmBtu.
"The reason (for the price drop) is no demand," an LNG trader said.
"China is doing nothing, Japan is dull, India doesn't do much," the trader said, adding ample spot cargo offers were also weighing on prices.
Indonesia's Pertamina and Italy's ENI jointly offered three cargoes for loading in August, September and October from Indonesia's Bontang LNG plant in a tender closing July 29.
Australia's Ichthys plant was selling two cargoes for loading in August and September in a tender that closed on July 26.
Also in Australia, Chevron sold a cargo from the North West Shelf plant to BP at $4.12 per mmBtu on the free-on-board FOB basis, while Diamond Gas International (DGI) sold a Wheatstone cargo to Royal Dutch Shell, a trade source said.
Egypt's EGAS cancelled its August tender for three cargoes, two sources said. One of the reasons was an increase in domestic gas consumption as summer is when Egypt's gas demand peaks, one of them added.
Nigeria LNG closed a tender for an August loading cargo on July 22.
Gazprom sold six FOB cargoes loading in Cameroon over 2020 to trading house Trafigura, two market sources said. One of them added the price level was a 19 cent discount to Japan Korea Marker (JKM).
There is also a number of US-sourced cargoes offered in the market. One source said the best offers were around $3.10 mmBtu.
On the demand side, South Korea's POSCO and S-Oil jointly purchased a cargo at around $5.10-$5.15 per mmBtu for delivery in the second half of October.
A trading house sold cargoes to India this week at around $4.00 per mmBtu.
Lithuanian fertiliser and chemical producer Achema bought four cargoes for delivery in the fourth quarter from Norway's Equinor.
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