* Late March cargoes sold at lowest level since 2009
* Sellers issue multi-cargo tenders
* Low prices lift Indian demand
By Ekaterina Kravtsova
LONDON, Jan 24 (Reuters) - Asian spot prices for liquefied
natural gas (LNG) plummeted to multi-year lows this week,
pressured by a lack of demand to consume abundant supplies.
As milder-than-usual winter in both Asia and Europe is
curbing demand, there were deals done below $4.00 per million
British thermal units (mmBtu) this week, the lowest level in
more than 10 years.
The average LNG price for March delivery into northeast Asia
<LNG-AS> was estimated at around $4.00 per mmBtu, down $0.60 per
mmBtu from the previous week, several sources said.
"Warm winter is a clear reason for such a low price," an LNG
trader said.
The Brunei LNG export plant sold a cargo for March 30-31
delivery at about $3.90 to $3.95 per mmBtu earlier in the week.
Commodity trader Vitol sold a cargo to BP
on Friday for March 22-26 delivery at $3.95 per mmBtu in the S&P
Global Platts Market on Close window.
The deal prices are at their lowest level in Asia since
summer 2009, according to data from S&P Global Platts that
assesses the Japan-Korea-Marker (JKM) price.
With the first half of March holding a slight premium to
late March, the average price for that month is at the lowest
level since April 2016, according to the same data.
Demand is expected to remain low in Asia next week, with
Chinese buyers largely out of the market due to the Chinese New
Year and Spring Festival holidays.
HEAVY SUPPLY
With the global gas market heavily oversupplied, new cargo
offers further saturated the market. Several sellers issued
multi-cargo tenders this week, with a number of one-cargo offers
on the market as well.
Russia's Gazprom has offered 18 cargoes for
loading at Belgium's Zeebrugge terminal between the second half
of Feb. 2020 and Dec. 31 2021.
The offer is for cargoes that Gazprom Marketing and Trading
buys from Russia's Yamal LNG, market sources said. Initially,
the 2.9 million tonnes per year volumes agreed in the deal were
expected to be supplied by Gazprom to the Asia-Pacific markets,
mostly to India, according to the company's statement from 2015.
Japan's Osaka Gas has offered two cargoes for delivery to
Europe in July and November from the Freeport LNG project in the
United States as demand in Japan is subdued due to mild weather
this winter.
Another offer came from Indonesia's Bontang plant for three
cargoes loading between February and April.
INDIAN DEMAND PICKS UP
Indian buyers, whose purchasing power depends on price
levels, have flooded the market seeking cargoes, market sources
said. But this was not enough to reduce global oversupply.
"At such low prices, demand has risen," one of the buyers in
the country said.
Gujarat State Petroleum Corp (GSPC) issued several tenders
seeking cargoes for February and March as well as between April
and October, market sources said.
Gail India was looking for a February cargo into
India and also offered a cargo from its Cove Point offtake in
the United States.
(Reporting by Ekaterina Kravtsova; Editing by Pravin Char)
BP (BP.)
