LNG Bunker Snapshot: Lower bunker premiums push Singapore's price down
Rotterdam’s LNG bunker price has edged higher on colder weather forecasts and supply concerns in Europe, while Singapore’s price has softened, pressured by lower LNG bunker premiums.
Weekly changes in LNG bunker prices:
- Rotterdam up by $10/mt to $643/mt
- Singapore down by $26/mt at $592/mt
Rotterdam
Rotterdam’s LNG bunker price has climbed by $10/mt week-on-week to $643/mt, even as LNG bunker premiums declined by 11%, easing from about $140/mt to $124/mt.
The increase was largely underpinned by a roughly 5% rise in the front-month Dutch TTF Natural Gas contract over the week, Europe’s key gas benchmark.
The price movement was “driven mainly by temperature outlooks and fluctuations in wind power generation,” and was further supported by “forecasts that temperatures across Europe would fall significantly below historical averages,” according to Japan Organization for Metals and Energy Security (JOGMEC).
“The market has refound foothold after the weather forecasts have turned colder lately and with temperatures in Germany set to drop to around or possibly even below average during the coming days, it should also lead to increasing gas demand,” noted Mind Energy (formerly Energi Danmark).
“European gas [price] also rose amid concerns over supplies,” ANZ Bank’s senior commodity strategist Daniel Hynes said.
Notably, Norwegian pipeline flows remained weak last month due to "unplanned outages or reduced production at the Asgard gas field until late December,” Rystad Energy observed.
The EU’s underground gas storage level stood at 61.4% on 2 January, down from 65.2% the previous week and 14.3% lower year-on-year, according to Gas Infrastructure Europe.
Singapore
Singapore’s LNG bunker price has declined by $26/mt week-on-week to $592/mt, largely driven by a 22% decrease in LNG bunker premiums, which shifted from about $112/mt to $87/mt.
As a result, Singapore’s discount to Rotterdam has widened to $51/mt, from $15/mt last week.
“Spot demand, especially from China, remained weak,” contributing to the downward pressure, according to JOGMEC.
“China spot buying stays very limited,” said Hendrian Sukardi, LNG market analyst at ENN Energy.
Meanwhile, LNG inventories for power generation in Japan reached 2.39 million mt as of 26 December, up by 150,000 mt from the previous week, according to Ministry of Economy, Trade and Industry (METI).
Other LNG bunker news
Oslo-headquartered shipping company Norwegian Car Carriers has placed an additional order for an LNG dual-fuel car carrier at China’s Raffles Yantai Shipyard.
By Tuhin Roy
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