Platts: Monthly Spot LNG Prices for April Delivery Fell 6.7% on Increased Supplies On a Year-Over-Year Basis, April LNG Prices were up 2.7%

SINGAPORE, March 19, 2014 /PRNewswire/ -- Prices of liquefied natural gas (LNG) for April delivery to Asia fell 6.7% to an average $18.113 per million British thermal units (/MMBtu) as the market finally began to cool off following recent historic highs, the latest Platts Japan/Korea Marker (JKM) for month-ahead delivery showed. The data reflects the daily Platts JKM for April assessed between February 16 and March 15 and expressed as a monthly average.

The Platts JKM for April was 2.7% higher than the April 2013 average of $17.636/MMBtu, therefore staying above the seasonal averages.

But prices slowly ebbed. The April JKM started the assessment period at $19.45/MMBtu and closed the period at $16.30/MMBtu. Within the month, the April JKM hit $19.50/MMBtu – the highest on record for April delivery – before dropping back $3.20/MMBtu on weaker demand from buyers in Asia and South America.

"The unexpected emergence of cargoes for prompt, late-March delivery from the Atlantic Basin put pressure on prices, which filtered into April pricing as the month wore on," said Stephanie Wilson, managing editor of Asia LNG at Platts, a leading global energy, petrochemicals and metals information provider and a premier source of benchmark price references. "After concluding deals early in the month for April delivery, buyers in both Asia and South America had already wrapped up procurement and were in no rush to take more cargoes, particularly as price offers began to drop."

"This, coupled with more reloaded cargoes on offer from Iberia and supply tenders from projects in the Atlantic and Asia-Pacific basins, led to an over-supplied market.  Adding to price pressures was the fact that many of the winter buyers in northeast Asia were able to scale back requirements as the start of region's slower-demand, spring season kicked in," Wilson explained.  

Meanwhile, prices of thermal coal and fuel oil – possible competing fuels to LNG – were also lower. On a month-over-month basis, thermal coal prices were down 6.2% for the February 16 to March 15 assessment period, while fuel oil prices were down 0.5%.  

Platts Spot JKM and Substitute Fuel Prices (Monthly Averages)*


Apr-14

Apr-13

Mar-14

Year-On-Year Change %

Month-On-Month Change %

JKM ($/MMBtu)

18.113

17.636

19.419

2.7

-6.7

Qinhuangdao coal ($/MMBtu)

3.845

4.105

4.098

-6.3

-6.2

180 CST fuel oil ($/MMBtu)

15.691

16.420

15.769

-4.4

-0.5

Source: Platts

*Referred to as month-ahead, the figures in the table are monthly averages of daily values assessed by Platts from February 16th to March 15th. The Platts JKM rolls on the 16th of each calendar month

The Platts JKM is an assessment of LNG prices for spot cargoes delivered to Japan and South Korea, based on the most recent trades and/or bids and offers from buyers and sellers in the open market prevailing at the close of the trading day. The monthly JKM assessments are month-ahead delivered prices and are an average of the daily JKM price assessments reported by Platts.

For more information on natural gas or the methodology used by Platts in its power assessments, visit the Platts website www.platts.com.

Platts' monthly reports on Asia LNG prices and market developments are typically published shortly after the 15th of each month.

About Platts: Founded in 1909, Platts is a leading global provider of energy, petrochemicals, metals and agriculture information and a premier source of benchmark prices for the physical and futures markets.  Platts' news, pricing, analytics, commentary and conferences help customers make better-informed trading and business decisions and help the markets operate with greater transparency and efficiency.  Customers in more than 150 countries benefit from Platts' coverage of the biofuels, carbon emissions, coalelectricityoil, natural gasmetalsnuclear powerpetrochemical, shipping and sugar markets.  A division of McGraw Hill Financial (NYSE: MHFI), Platts is headquartered in New York with approximately 900 employees in more than 15 offices worldwide. Additional information is available at http://www.platts.com.

About McGraw Hill Financial: McGraw Hill Financial (NYSE: MHFI), a financial intelligence company, is a leader in credit ratings, benchmarks and analytics for the global capital and commodity markets. Iconic brands include: Standard & Poor's Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts, CRISIL, J.D. Power and McGraw Hill Construction. The Company has approximately 17,000 employees in 29 countries. Additional information is available at www.mhfi.com.

SOURCE Platts



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