LNG Bunker Snapshot: Singapore’s price falls as bunker premiums shrink

Singapore-ARA spread narrows to $182/mt

US-Iran war keeps gas market on the edge

Lower bunker premium drives Singapore LNG price lower

Weekly changes in LNG bunker prices:

• Rotterdam up by $9/mt to $984/mt
• Singapore down by $52/mt at $1,166/mt

Rotterdam

Rotterdam’s LNG bunker price remained broadly stable over the past week, mirroring the stability of the front-month Dutch TTF Natural Gas contract, a key European gas benchmark.

“News of progress in peace negotiations between the U.S. and Iran” and “lower demand due to mild weather and stable supply fundamentals” weighed on TTF prices. However, that downward pressure was partially offset after “the U.S. conducted airstrikes in southern Iran,” which supported prices, according to the Japan Organization for Metals and Energy Security (JOGMEC).

“Developments in the geopolitical sphere around the US/Israel war on Iran dominated the gas sector... Initially, reports of renewed fighting supported prices... Later on, gains were curtailed, as news about a potential peace deal being close was making rounds,” according to Mind Energy.

“Renewed skirmishes and reports of deals saw wild swings in sentiment,” noted ANZ Bank senior commodity strategist Daniel Hynes.

Meanwhile, EU underground gas storage levels rose to 39.7% on 29 May from 37.5% a week earlier. Despite the increase, storage remained 16.4% lower than the same period last year, according to Gas Infrastructure Europe data.

Singapore

Singapore’s LNG bunker price has fallen by $52/mt week-on-week to $1,166/mt, largely due to an 11% decline in LNG bunker premiums, which dropped from around $240/mt to $214/mt.

As a result, Singapore’s premium over Rotterdam has narrowed to $182/mt, down from $243/mt last week.

“Reports that peace negotiations between the U.S. and Iran were nearing agreement” contributed to the downward pressure, according to JOGMEC.

North Asia LNG prices also declined as “more LNG tankers have exited the Persian Gulf,” further weighing on the market, according to ANZ Bank’s Daniel Hynes.

“Qatar and Adnoc have quietly exported four LNG shipments through Hormuz in the last week,” echoed Stephen Stapczynski, Energy Asia team leader at Bloomberg News.

In other LNG bunker news, French shipping company CMA CGM has taken delivery of the first vessel in a series of 10 LNG-capable newbuilds.

Bunker supplier Molgas has completed a cool-down and LNG bunkering operation for a dual-fuel liquefied carbon dioxide (LCO2) carrier in Øygarden, western Norway.

Singapore-based shipping company Pacific International Lines (PIL) has completed its first LNG bunkering operation at the Port of Shanghai.

By Tuhin Roy

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