LNG Bunker Snapshot: Middle East risks lift Rotterdam price
Rotterdam’s LNG bunker price has climbed amid rising Middle East tensions and low EU storage levels, while Singapore’s price has declined due to weak Asian demand and a holiday-related slowdown.
Weekly changes in LNG bunker prices:
- Rotterdam up by $9/mt to $704/mt
- Singapore down by $13/mt at $720/mt
Rotterdam
Rotterdam’s LNG bunker price has risen by $9/mt, tracking gains in the front-month Dutch TTF natural gas contract, which climbed by $0.17/MMBtu over the past week to $10.93/MMBtu ($568/mt).
The firmer TTF market has been partly driven by escalating geopolitical concerns.
“The fears of a war in Iran and possibly also in the Persian Gulf could also have an effect on gas exports from first and foremost Qatar,” according to Mind Energy, formerly Energi Danmark.
TTF prices also increased “amid rising tensions on Iran's nuclear plans and growing risk of military escalation,” said Greg Molnár, gas analyst at the International Energy Agency (IEA).
Broader market anxiety has centered on supply security and key transit routes.
“European futures extended gains… on concerns about Middle East tension. The Strait of Hormuz is a key waterway for ships carrying LNG. Europe’s gas storage facilities are unusually low, with weeks left of the heating season. Supply disruption would make refilling difficult,” commented ANZ Bank’s senior commodity strategist Daniel Hynes.
An escalation in the Middle East would place a substantial portion of global LNG trade at risk, particularly at a time when EU gas inventories remain below seasonal norms. EU gas storage is currently less than 32% full, compared with a five-year average of 49%, according to two analysts from ING Bank.
Singapore
Singapore’s LNG bunker price has fallen for a third straight week, pressured by softer regional demand.
The decline was driven by “weak Asian demand” as “winter is ending,” according to Stephen Stapczynski, Energy Asia team leader at Bloomberg News.
Market activity across the Pacific has also eased. Activity has been “quieter through the holiday period, as seasonally expected,” gas transportation firm Fearnley LNG noted.
In China, bunkering activity remained slow during the Chinese New Year holiday period from 15–23 February, market sources said. South Korea likewise saw subdued bunkering demand during the Lunar New Year (Seollal) holidays from 16–18 February.
North Asia LNG prices have faced additional downward pressure from “concerns of weaker demand from key consumers. China’s LNG imports dropped during the Lunar New Year holiday amid a slowdown in industrial activity,” ANZ Bank’s Hynes commented.
The decline aligns with a $0.26/MMBtu drop in the NYMEX Japan/Korea Marker (JKM), bringing the front-month contract down to $10.73/MMBtu, equivalent to $558/mt.
Reflecting this broader weakness, Singapore’s LNG bunker price premium over Rotterdam has narrowed significantly. After standing at $38/mt a week earlier, the premium has since narrowed to $16/mt.
Other LNG bunker news
Methane-focused industry group Gasnam has indicated that the Iberian Peninsula is poised to surpass the Netherlands as a key bunkering hub for LNG and its lower-emission derivatives.
In parallel, classification society Bureau Veritas Marine & Offshore (BV) has teamed up with China’s Hudong-Zhonghua Shipbuilding to design an 18,600 cbm LNG bunkering vessel.
Meanwhile, the Chinese government has set targets to establish annual bunkering capacity in Shanghai of 1 million cbm for LNG, along with 1 million mt for biofuel and methanol, by 2030.
By Tuhin Roy
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