At least five LNG cargoes have been diverted from Asia to Europe in the past few days.
This was down to higher gas prices in Europe after Russia's Gazprom halted supplies to Austria's OMV, according to data from analytics firm Kpler.
Last week, Gazprom halted supplies to major Austrian gas importer OMV after the company had threatened to impound some of the Russian state firm's gas as compensation for an arbitration won over a contractual dispute.
Gazprom notified OMV of the planned halt last Friday, causing
European gas prices at the Dutch TTF hub to surge, making it more profitable to send gas to Europe rather than Asia.
"The JKM/TTF spread flipped into negative territory last week amid Russian pipeline gas supply concerns and an upcoming cold spell, which saw traders divert LNG cargoes away from Asia and towards Europe," said Laura Page, Kpler’s Manager of Gas and LNG Insight, talking with Reuters.
The benchmark front-month contract at the Dutch TTF hub was trading at €46 per MWh on Monday, or $14.49 per MMBtu, the highest level since 23rd November, 2023, while the Asian benchmark Japan Korea Marker (JKM) was trading at around $14 per MMBtu, LSEG data showed.
The LNGC ‘Vivert City’, which loaded a cargo from Equatorial Guinea for Bangladesh, diverted on Friday and is now heading towards Britain's South Hook terminal.
‘Gaslog Windsor’, which had loaded US LNG from Sabine Pass that was initially bound for China, also changed her destination on Friday towards the UK’s Isle of Grain terminal. With a Nigerian cargo, ’BW Lesmes’ was initially heading for China but also changed destination to the Isle of Grain.
"One of the main reasons ships are switching to the UK, though, is likely that the UK's terminals weren't so busy as some of the main Continental terminals, meaning there were more spare unloading slots for traders to access when they decided to divert Asian cargoes to Europe," said Alex Froley, ICIS Senior LNG Analyst.
Another LNGC ‘Diamond Gas Crystal’, originally heading for South Korea, is now heading to Rotterdam’s Dutch Gate terminal and the ‘Flex Vigilant’ diverted from China and is now heading for Europe, for orders.
