Asian liquefied natural gas (LNG) spot price rose to a record high on Thursday on the back of robust demand for the super-chilled fuel and low supply.
A combination of low stocks and strong demand for gas have pushed up prices in Europe, while a colder than expected winter in North Asia is fuelling the price surge.
Price agency S&P Global Platts said on Thursday that its Japan-Korea-Marker (JKM), which is widely used as a benchmark for spot LNG contracts, rose to $34.47 per million British thermal units (mmBtu).
It broke the previous record of $32.50 per mmBtu reached in mid-January during the peak of winter, Platts data showed.
“The global LNG price rally is largely driven by the European gas situation,” said Ciaran Roe, Platts’ global director of LNG.
In Europe, gas storage levels remain suppressed against historical averages, constrained LNG imports and strong gas demand due to post-lockdown economic recovery, Roe said.
Fuel shortages in China, which is creating higher demand from utilities, lower than average temperatures expected in China and South Korea and lower capacity utilisation of liquefaction plants globally due to ongoing supply issues, are also factors, he added.
Gas price at the Dutch TTF hub , a European benchmark, rallied to new highs on Thursday on supply concerns, forecasts of cold weather and short-covering ahead of the official start to the winter gas season.