Platts April LNG Japan Korea Marker was higher at $14.725/MMBtu at the end of the Asian trading week on the back of post-winter spot demand carried over from March. The April JKM rolled over at $14.675/MMBtu Thursday.
There was a significant price gap between buyers and sellers for April shipments, but offers looked increasingly bullish across the week.
This week, more offers for April cargoes were heard to be above the $15/MMBtu level, although the more competitive ones were still in the high $14s/MMBtu, according to trade sources.
Concluded deals also left dearer cargoes in the market.
State-owned Kuwait Petroleum Corp. secured three spot LNG cargoes for delivery in early April, H1 April and H2 April. Two of the shipments were sold by a major gas trading company, while one was sold by a global trading company specializing in LNG exports, KPC said late Tuesday, without revealing their names, or pricing details.
A source said the market was "looking strong enough" in April, as North Asian buyers would have to compete with the Middle East for spot cargoes in the summer period.
End-users largely kept their bids in the low $14s/MMBtu for April, but reported bids for H1 April had improved to above $14.50/MMBtu.
Sources variously said mid $14s/MMBtu was the deal level for April shipments. First-half April was assessed at $14.75/MMBtu Friday, while H2 April was at $14.70/MMBtu, keeping a 5 cents/MMBtu backwardation between the two half months on the back of lower demand in the later half with the onset of spring.
A North Asian utility source said H1 and H2 April could see a slight backwardation as H1 April might be slightly affected by the lingering effects of cold weather in Europe, which tightened supply and made Atlantic cargo diversions more difficult.
Some sources viewed a flat price structure within April, especially in view of the continual shutdown of nuclear reactors in Japan.
Japan's combined nuclear generation capacity is set to fall to 2.268 GW over two nuclear reactors on February 20, as Kansai Electric is scheduled to shut the 870 MW No. 3 reactor at its Takahama nuclear power plant in western Japan that day, Platts calculations showed.
North Asian utilities also said the cold snap only lasted for a short period and most of them still had sufficient inventory, coupled with high operating rates of gas-fired power plants, additional demand was limited in April.
Most of Japan is expected to experience temperatures below the 30-year average over February 18-March 17, the weekly weather forecast released Friday by the Japan Meteorological Agency showed.
Hokkaido in the north, the main central island of Honshu, and the southern island of Amami will have below-average temperatures for the forecast duration.
Platts April DES West India was assessed at $12.85/MMBtu Friday, up 5 cents/MMBtu from Thursday, when it rolled over at $12.80/MMBtu.
Bids from West Asia were at $12/MMBtu to mid $12s/MMBtu, although only one utility showed firm interest to buy a cargo for H1 April.
Platts FOB Middle East was lower at $12.15/MMBtu Friday, after starting the week at $12.20/MMBtu.
The Asia Pacific Day Rate was unchanged, ending the week at $135,000/day Friday.
"The market is softening...it's not as strong as last November and December...Spot charter rates are holding at around $130,000-140,000/day," a market source said.
He added that there were vessels available at the moment prior to the commencement of their next charters, but "the market is quiet now, with lesser interest from the Far East" due to the seasonality effect.
