ROI-LNG spot price surge deters Asian buyers, but saves Europe: Russell
High spot prices are deterring buyers from China and South Asia, resulting in Asia's lowest September imports in eight years.
According to data compiled by Kpler, the top-importing continent will see arrivals of?20.09 million tons of super-chilled gasoline in September. This is the lowest figure for this month since September 2018 when 19.88 million arrived.
Asia's imports have dropped?from 22.27 millions tons in September of last year and also from 22.25 in August.
The slump in Asian LNG demand has freed up cargoes to Europe, where it is struggling to store enough natural gas ahead of the winter.
The European Union's natural gas stocks are currently at 68%, or 16 percentage points less than the average for the past five years.
Kpler estimates that September LNG imports will reach 7.98 million tonnes, up from 7.55 millions in August. This is the highest since May.
Kpler estimates October arrivals at 10,53 million tons, and November at 10,62 million. These levels are in line with those of 2025.
Data shows that Asia has once again opted out of cargoes. This allows Europe to purchase?more LNG at a higher price.
The market has become tighter due to the ongoing loss of Qatari LNG as a result of the conflict between the United States of America and Iran over the Strait of Hormuz.
Before the start of the conflict on February 28, Qatar provided nearly 20% of global LNG. It was also the second largest shipper after the United States, behind Australia.
Qatar's shipments are down dramatically, as Kpler shows that only 70,000 tons or one cargo managed to leave the Strait of Hormuz last August. This is down from an annual average of 6.51 millions tons between the months of February and August.
Spot prices have risen 45 months in the absence of Qatari LNG, with cargoes bound for North Asia.
The price of spot LNG is now 150% higher than the $10.40 per million Btu it was in the week ending February 27. This means that the rise in Brent crude oil futures has been 50%.
CHINA CURBS
China is still reducing its LNG imports. Kpler estimates that September arrivals were 4.32 million tonnes, down from the 5.20 million tons in August and 5.32 millions in September last.
The current spot price of oil is more than double what it would be if China continued to import at fixed prices or at prices linked to oil.
India, Asia's largest LNG buyer, also shows signs of price pressure, with September imports expected to drop to 1,86 million tons - the lowest since March - and down from 2,09 million last September.
In September, Pakistan will receive just 120,000 tons, down from the 490,000 tonnes it received in the same period last year.
The global LNG market's overall dynamics are largely similar to the last major crisis of 2022. This was triggered by the loss in Russian gas pipelines into Europe following the Russian invasion of Ukraine in February that year.
In August 2022, spot prices in Asia reached a record high at $70.50 per million Btu. While this was only a temporary spike, the price remained above $20 through January 2023.
Asia's LNG imports dropped from 2021 to 2022, and then didn't increase until 2024 when they reached a record of 287.16 millions tons.
Europe's LNG exports, on the other hand, soared in 2022. They reached a record of 124.54 millions tons, up by 59% over 2021.
In the absence of Russian pipeline gas, Europe's LNG imports have remained high. A new peak?of 125.2 million tons was set in 2025.
Kpler has already estimated that imports will reach 117.01 millions tons in 2026. This figure is expected to rise during the final quarter.
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(source: Reuters)
