Asian prices steady, under pressure from high inventories

SINGAPORE  - Asian spot liquefied natural gas (LNG) prices remained steady this week, but were still hovering near record lows in response to oversupply and high inventories in the region, several trade sources said.

The average LNG price for July delivery into northeast Asia LNG-AS was estimated to be about $2.10 per million British thermal units (mmBtu), similar to the previous week, they said.

Prices for cargoes to be delivered in August were slightly higher at about $2.20 to $2.30 per mmBtu, they added.

"Demand is starting to slow down again as Chinese storages are filling up and European inventory is already at pre-winter storage levels," a Singapore-based trader said.

South Korea's Korea Gas Corp (KOGAS) has deferred several cargoes to the later part of the year as it grapples with high inventory, several industry sources said. 

The exact number of cargoes deferred could not immediately be confirmed, but one source said it was likely to be at least 16 and possibly as many as 30 cargoes.

In Japan, demand is still down due to the coronavirus outbreak and inventory remains high, one source said.

Still, Japan Petroleum Exploration Co (Japex) was seeking a cargo for delivery in August, while Tohoku Electric bought a cargo for delivery in July at about $2.10 to $2.20 per mmBtu, traders said.

There was some demand from India, with Bharat Petroleum Corp seeking a cargo for delivery in September, while Gujarat State Petroleum Corp (GSPC) bought a cargo for delivery in early July at about $2 to $2.30 per mmBtu, sources said. 

Several cargoes were offered from Russia, Brunei, Indonesia, Angola and Papua New Guinea this week, showing that supplies are plentiful.

Australia's Gladstone plant is likely to have sold a cargo for loading in second half of June to Total at close to $2 per mmBtu on a free-on-board (FOB) basis, sources said.

(Reporting by Jessica Jaganathan, additional reporting by Ekaterina Kravtsova in London. Editing by Jane Merriman) ((Jessica.Jaganathan@thomsonreuters.com; +65 6870 3822; Reuters Messaging: jessica.jaganathan.thomsonreuters.com@reuters.net; Twitter: https://twitter.com/j3ssi3))