LNG Bunker Snapshot: Singapore-ARA spread narrows as European gas supply concerns lift Rotterdam

Singapore-ARA spread narrows to $66/mt

TTF rises on Norwegian outages, colder forecasts and Hormuz disruption

JKM increases on rising European gas prices

Weekly changes in LNG bunker prices:

• ARA up by $97/mt to $1,873/mt
• Singapore up by $74/mt to $1,939/mt
• Baltics up by $97/mt to $1,976/mt

ARA

Rotterdam’s LNG bunker price rose for the fifth consecutive week, climbing by $97/mt week-on-week to $1,873/mt.

The rise tracked an approximately 3% increase in the front-month Dutch TTF Natural Gas contract over the week. TTF is Europe’s benchmark gas price. A higher LNG bunker premium also supported the price, rising by $0.73/MMBtu to $3.17/MMBtu ($165/mt).

TTF rose amid expectations of increased gas-fired power generation, following a decline in wind power generation and unplanned outages at Norwegian gas production facilities, according to the Japan Organization for Metals and Energy Security (JOGMEC).

“The market has moved higher, with little sign of imminent relief in Persian Gulf LNG flows,” said ING Bank head of commodities strategy Warren Patterson. He added that several unplanned outages in Norway would add to supply concerns.

TTF found support from continued LNG supply disruption via Hormuz, colder temperatures, four unplanned outages in Norway at Kollsnes and Kårstø, and some countries starting to withdraw gas from storage, International Energy Agency (IEA) gas analyst Greg Molnár said.

TTF was also driven by forecasts of falling temperatures across Europe, concerns over gas supplies next winter, and supply uncertainties arising from the shutdown of all trains at Freeport LNG in the US and shipping disruptions in the Middle East, JOGMEC added.

EU-wide underground gas storage stood at 74.7% on 30 October, almost unchanged from the previous weekend but 10.5% below the level recorded during the same period last year, according to Gas Infrastructure Europe.

“EU storage levels are at their lowest since 2013,” Molnár said.

Weather forecasts also turned colder and calmer over the weekend, adding bullish support to a market already under pressure from Middle East uncertainty and low gas storage, Mind Energy said.

Rotterdam’s liquefied biomethane (LBM) price rose by $100/mt week-on-week to $2,575/mt.

Biomethane prices in Germany have risen on the back of higher gas prices rather than a bigger green premium, said Henning Dicks, co-founder of agriportance. “This is a gas rally, not a green gas boom in Germany,” according to Dicks, with the increase a windfall from the gas market driven by the Middle East crisis and low storage levels.

Singapore

Singapore’s LNG bunker price rose by $74/mt week-on-week to $1,939/mt, a smaller increase than Rotterdam’s. This narrowed Singapore’s premium over ARA to $66/mt from $89/mt a week earlier.

Singapore’s LNG bunker price typically tracks the front-month NYMEX Japan/Korea Marker (JKM), which has risen by $1.42/MMBtu ($74/mt) to $32.84/MMBtu ($1,708/mt). The bunker premium over JKM was unchanged at $4.45/MMBtu ($231/mt).

JKM rose on the back of rising European gas prices amid falling temperatures and low underground gas storage levels in Europe, according to JOGMEC.

“European benchmark prices have gained more than 200% since the start of the Middle East conflict, but high prices are failing to deter Asian buyers,” said ANZ Bank senior commodity strategist Daniel Hynes.

LNG shipments through Hormuz are still just 30% of pre-war levels, with the disruption to cargoes that made up almost a fifth of global exports last year sending Asian prices to their highest levels since 2022, said Bloomberg News Energy Asia team leader Stephen Stapczynski.

In other LNG bunker news, Norwegian shipping company Wallenius Wilhelmsen has signed agreements with China’s Jinling Shipyard for four pure car and truck carriers (PCTCs).

Japanese shipping company Mitsui O.S.K. Lines (MOL) has taken delivery of an LNG-capable dual-fuel coal carrier fitted with a wind sail.

Norwegian shipping company Utkilen has taken delivery of M/T Listraum, the second of four LNG-capable tankers being built at Icdas Shipyard in Türkiye.

Japanese bunker supplier Keys Bunkering West Japan (KEYS) has completed the 100th LNG delivery by its bunkering vessel Keys Azalea, supplying NYK Line’s bulk carrier SG Dawn.

By Tuhin Roy

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