LNG Producers Need to Find New Markets

LNG producers are encouraged to cut supply amid the global glut that is helping drive down prices in Asia, or push more volumes to markets beyond Europe, perhaps Latin America.
The takeaway from the 19th annual S&P Global Platts LNG Conference in Houston was that something has to give, and soon, to allow for more liquefaction projects to be built in time to fill a projected supply shortage around the middle of the decade.
Qatari expansions and additional units coming online in the US that were sanctioned years ago, in addition to supplies coming from Australia and other exporting countries, are pumping more LNG into traditional end-use markets than those markets can handle. Prices have cratered in recent months, S&P Global reported.
Weaker-than-expected demand, relatively mild winter weather, the coronavirus outbreak and Chinese tariffs have made the situation worse.
"The global market needs to balance [things out] by turning off supply. It's got to get somebody to do that. It has not done that in a significant size," Andrew Helm, a senior LNG trader at British utility Centrica, told the conference.
 "The Asian Basin is essentially telling the Atlantic Basin, 'Whatever you do, please don't send us any cargoes for the winter.'"