LNG bunker prices have risen in Rotterdam and especially in Singapore, where demand has grown to put pressure on bunker slot availability.
Changes in weekly LNG bunker prices:
- Rotterdam up by $8/mt to $543/mt
- Singapore up by $42/mt to $639/mt
Rotterdam
The uptick in Rotterdam’s LNG bunker price was primarily driven by a combination of supply concerns and increased spot demand from buyers in the wider gas market.
The port’s LNG bunker price increase aligns with an upward trend in the benchmark TTF (Title Transfer Facility), reflecting broader LNG market dynamics. LNG bunkering, while a small segment of the overall LNG market, is linked to the larger market trends.
Liquefaction trains at the Freeport LNG export plant in Texas, US will likely be shut down for weeks. These trains are key to liquefying and compressing natural gas into LNG, and two in three of them will remain out of service until May, Freeport said.
“Although historically Freeport LNG plant has sent most of its cargoes to Japan and South Korea, since the onset of sanctions on Russian material, it has been sending more cargoes to Europe,” Sparta Commodities analyst Samantha Hartke tells ENGINE.
European gas storage levels fell slightly from over 60% last week, to 59% this week. European gas storage levels are often correlated with gas prices, including benchmarks like TTF. However, this marginal drop is unlikely to have made a significant impact on LNG bunker prices in the past week, given the overall robustness of storage levels compared to previous years.
Early last week, European gas prices were rising sharply due to an unplanned outage and supply disruptions at a major Norwegian gas field, a report from Denmark Energi stated.
Singapore
In Singapore, LNG bunker prices saw a significant increase of $42/mt.
Demand for LNG bunkering has surged this week, with bunker delivery slots filling up rapidly. For April dates, slots are already becoming scarce, an LNG trader tells ENGINE.
Factors influencing the Asian LNG market, including JKM (Japan-Korea Marker) prices, also impact LNG bunker prices in Singapore, the trader says.
Price-sensitive buyers from China, India and southeast Asia continued to capitalise on lower prices by increasing their spot LNG purchases, Hartke says.
India’s plans for significant LNG consumption growth towards 2030, and its long-term supply deals with companies like Vitol Asia, signify a growing LNG market. And China’s LNG imports are forecasted to expand by 8.1% in 2024, according to China National Petroleum Corp.
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Source: Engine
