LNG

Bangladesh’s Petrobangla and several Indian buyers are tendering for spot LNG, puling more than 11 cargoes away from Europe towards Asia by early April. Further diversions are likely since Indian companies awarded only 4 out of 15 spot LNG tenders for April and May so far, according to Platts data.

Traders and LNG portfolio players are competing for regasification capacity to land LNG cargoes in Europe, though the European LNG arbitrage stayed closed for much of 2025. According to Platts data, the economics begin to reflect oversupply with the LNG-TTF price spread widening.

Intercontinental Exchange Inc., the leading global provider of energy trading platforms for West Texas Intermediate (WTI) crude oil to European and Asian LNG and natural gas futures and options, has reported record activity in the ICE Midland WTI contract this month with participants using the contract to deliver physical Midland WTI barrels into Dated Brent and the rest of the Brent complex.

The European Union Agency for the Cooperation of Energy Regulators (ACER) said it planned to publish its own price assessment for LNG in Europe to replace the Dutch Title Transfer Facility (TTF) market price in a move seen as seizing control of prices and interfering with free markets.

Intercontinental Exchange, the leading global provider of trading platforms and clearing, and US pricing agency Platts have launched simultaneous consultations with the market on the evolution of the Brent complex, which includes Dated Brent, Cash Brent and ICE Brent Crude Oil futures.

ICE, which also operates other exchanges, including the New York Stock Exchange, also offers its platforms to allow traders to manage risk across multiple asset classes, including LNG.

In the ICE overall energy complex, it has posted record activity during 2021 in two key LNG trading derivatives, the European benchmark Dutch Title Transfer Facility (TTF) and the Japan-Korea Marker for North Asian spot cargoes.

The paper on the Brent market, co-authored by Platts and ICE which oversee, respectively, the Dated Brent physical benchmark price assessment and the ICE Brent Crude Oil futures contract, provides an overview of options for adding additional deliverable crude oil to the Brent complex and outlines a number of key issues and questions as it seeks market feedback.

Ongoing discussions conducted separately by ICE and Platts have demonstrated that industry opinion has focused specifically on two possible streams of crude to become part of Dated Brent.

The first is Johan Sverdrup as a deliverable option under the Forward Brent contract, which would remain on a Free on Board (FOB) basis.

The second is West Texas Intermediate (WTI) Midland oil, which would be a deliverable grade on a FOB US Gulf Coast basis.

All interested parties are encouraged to provide feedback and to put forward any further relevant items through the respective consultation channels.

The deadline for comments is September 30, 2021.

“Key to Brent’s multi-decade success as the global crude oil benchmark, has been its ability to evolve, and we look forward to ongoing discussions with customers as we navigate this next phase of its evolution with Platts,” said Jeff Barbuto, Global Head of Oil Markets at ICE.

“Our goal for this consultation is to facilitate a discussion with market participants covering all of the key issues which need to be addressed so that we can strengthen the Brent complex for decades to come,” added Barbuto.

In addition to Brent, natural gas has become a global market and the record levels of open interest and strong trading activity in TTF and JKM LNG futures reflect how these contracts have been developed by ICE and are at the forefront of global natural gas price formation.

Some long-term LNG supply contracts for nations like Japan are also linked to the oil price.

TTF and JKM futures and options form part of ICE’s global natural gas complex alongside the UK National Balancing Point, Henry Hub, the West India Marker (WIM) LNG (Platts) and the Spark LNG Freight Futures contracts. 

H-Energy of India, whose chartered floating storage and regasification unit (FSRU) is currently deployed as the seventh LNG Indian import terminal at the West Coast port of Jaigarh in the state of Maharashtra, said the facility would be importing up to 4 million tonnes per annum by 2022 and more after that for truck-loading and bunkering.

LNG Asian spot prices fell to a more than three-year low last week, dragged down by cargoes trading at near record low prices, trade sources told Reuters.

Spot prices for September delivery to Northeast Asia LNG-AS are estimated to be about $4.10 per mill British thermal units (mmBtu), down 15 cents from the week before, the sources added.

This is the lowest price seen since April, 2016, Reuters’ data showed.

Ample supply of LNG and remaining weak demand for the fuel has seen at least two spot trades concluded at below $4 per mmBtu for August and September cargoes.

Indian Oil Corp bought a cargo for delivery in the second half of August from commodity trader Trafigura at $3.69 per mmBtu through a tender, industry sources said, while China National Offshore Oil Corp (CNOOC) bought a cargo for delivery in early September from Vitol at $3.90 per mmBtu.

The last time a cargo traded below $4 was likely about three to four years ago, two sources said.

IOC also bought a cargo for September delivery at $4.20 per mmBtu from Vitol, while PetroChina bought a cargo for September delivery from Vitol at $4.05 per mmBtu, during the S&P Global Platts trading period on Wednesday, the sources added.

European spot LNG prices have been trading at a discount to the benchmark Dutch month-ahead gas price at levels below $3.40 per mmBtu last week.

However, traders appear to be taking advantage of the low spot prices by starting to make enquiries to book vessels to store or ship LNG, as they hedge on winter demand to boost prices.

At least one Japanese trader has inquired for a vessel to operate for 60 days to charter an Australian cargo loading in September, said a shipbroker, talking with Reuters.

Australia’s Ichthys LNG plant has offered two cargoes for loading in early September, traders said.

On the demand side, Turkish state energy company state energy company Botas is looking to buy three cargoes for delivery in August, September and October, while India’s Gujarat State Petroleum Corp (GSPC) sought cargo for delivery in early September, they said.

Guangzhou Gas is also seeking a cargo for late August delivery into Dapeng via a tender, traders said.

Intercontinental Exchange, the operator of global platforms and clearing houses for energy and commodities, reported record trading in the continental European natural gas Dutch Title Transfer Facility (TTF) contract and in the Japan-Korea Marker contract used for North Asian LNG cargo pricing.

ICE said in a statement that Dutch TTF futures hit an open interest (OI) record of 1.04 million lots in January 2019.

“TTF futures and options combined achieved monthly volume of 952.4 terawatt hours (TWh) in January,” said ICE.

The Dutch TTF is a virtual trading point for natural gas in the Netherlands, set up by natural gas network company Gasunie in 2003.

Since then the Dutch TTF has become a leading continental European benchmark and trading hub for spot, forward and futures gas trades. It has grown in importance as the UK prepares to leave the European Union.

“Average daily volume (ADV) and OI in TTF futures and options combined are up 103 percent and 64 percent respectively in January 2019, versus January 2018,” said the trading platform operator.

ICE said the JKM LNG futures, part of price discovery by Platts, a subsidiary of US company S&P Global Inc., formerly McGraw Hill Financial, traded a record 25,605 lots in January, an increase of 22 percent compared with the previous record of 20,916 lots set in November 2018.

The JKM LNG hit an OI record on February 4, 2019, of 26,928 lots. Average daily volume and OI in JKM LNG are up 176 percent and 123 percent, respectively, in January 2019, versus January 2018.

ICE added that as previously announced it will launch its JKM LNG Average Price Options on March 4, 2019, subject to the satisfactory conclusion of applicable regulatory processes.

“Europe’s vast energy infrastructure and geographical location allow it to provide a unique role as a balancing market for LNG,” explained ICE.

“The TTF and the UK National Balancing Point are the two most liquid European natural gas benchmarks and, with its continued record trading activity, TTF is transforming into a global natural gas benchmark,” said Gordon Bennett, Managing Director, Utility Markets at Intercontinental Exchange.

“JKM LNG is one of the fastest growing natural gas benchmarks and has established itself as the most liquid Asian natural gas benchmark,” added Bennett.

Aug 22 (LNGJ) - Prices of spot LNG for September delivery to Asian markets have plummeted 33.1% year-on-year (y-o-y) to an average $10.702/MMBtu, the latest Platts Japan/Korea Marker for month-ahead delivery shows.

The drop came as increased supply in the region continued to outweigh lackluster demand. On a month-on-month basis, the September JKM was down 5.8% from August.