Asian liquefied natural gas prices rose this week on fresh Indian and ongoing South Korean demand as a forthcoming production outage in Australia was set to curb global supply.
Month-ahead prices for November delivery hit two-month highs of $6.10 per million British thermal units, up 35 cents from last week, Reuters reported.
The Gladstone LNG export facility run by Australia's Santos is to shut down one production line from early October to around Oct. 23, feeding into bullish sentiment on prices as supply tightened.
India's Bharat Petroleum is seeking one cargo for delivery in October, November and December, with peer Indian Oil Corporation looking for a single November shipment.
Previously traders had warned that price-sensitive Indian demand could be limited by rising prices, but rallying Brent crude may provide more headroom for those companies to keep spending on gas. Importers in India tend to compare spot LNG prices against competing oil-derived fuels. Rising oil prices could keep demand alive for LNG, one trader said.
Korea Gas Corp, however, is arranging for extra shipments from long-standing Qatari supplier RasGas to replenish reserves and cater to extra demand as additional nuclear power stations are taken offline for maintenance.
In the wake of the country's biggest earthquake, four nuclear reactors with combined capacity of 2,770 megawatts were taken offline as a precautionary measure. Korea Gas Corp is also expected to tap a leading oil major for LNG supply as well as another Middle Eastern producer, one trader said.
Add new comment
Read our comment policy before posting your viewpoints