Each new month shows how globalized natgas market really is and how changing fundamentals in one region affect the others.
In January, when LNG prices in the Asian region reached record highs, it was buyers in the East that set the tone for the global gas market. LNG price rise was certainly not the only reason for the gains in Europe, but the contribution of that factor can hardly be overemphasized due to high competition for cargoes amid the seasonal increase in demand, and especially when pipeline supplies are limited. Europe was following Asia to have at least theoretical possibility for drawing LNG volumes.
Now, in February, the focus has shifted from the East to the West. In the lack of buying interest among Asian importers, which had already met their needs in the run up to the Lunar New Year, the movements at the European hubs started to provide a sort of guidance for Asia. Based on the results of trades, Platts JKM development was actually synchronized with that of TTF last week.
As natgas market becomes more global, ‘world centre’ for price setting is moving routinely between the regions. Players are literally required to look both ways for the accurate interpretation of the situation.
Source: Yakov Grabar
See original post by Yakov at LinkedIn.
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