Declines in oil prices helped to push down average LNG prices at the start of the year.
Japan’s average LNG import price was $7.8/MMBtu in January, a drop of nearly 50% year on year. Even in January 2011, just before the Fukushima disaster resulted in the shutdown of Japan’s nuclear capacity, the average price of LNG imports was roughly $11.7/MMBtu. As oil prices have declined further, contracted LNG prices in Asia have also fallen. South Korea’s average import price was $8/MMBtu in January and China’s was $7.38/MMBtu. Oil prices are expected to recover in H2 this year, but as the more recent declines have yet to filter through to the region’s oil-linked LNG, average LNG prices are expected to fall further over the coming months.
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