LNG price trends
Average LNG prices in the Asia Pacific region have made further gains while spot prices for the peak of summer are under pressure.
The average price of Japan’s LNG imports was $8.6/MMBtu in May, an increase of 46% year on year. A similar rise was seen in South Korea, where imported LNG cost $8.3/MMBtu on average during the month, up by 39% on an annual basis. A smaller rise was seen in China, where the average price increased by 16% year on year, to $7.3/MMBtu. Despite the annual gains, the average LNG import prices for all three countries remain below where they were in May 2015. Prices for contracted volumes are expected to remain above those for spot cargoes during the peak summer months. Oil prices are expected to rise during the rest of 2017 and in 2018. This will continue to push up the average price of LNG in Asia as most of the region’s long-term contracted supplies are oil-indexed, a situation that will not change dramatically in the short term.
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