Asian spot LNG prices finished the week down at $10.025/MMBtu, as demand for cargoes softened after CPC's buy tender was awarded.
Platts' March LNG Japan Korea Marker started Monday at $10.10/MMBtu.
CPC purchased three cargoes to be delivered in April and May instead of the six that it was looking for, sources told Platts without providing further details.
"CPC opted to take fewer LNG [cargoes] than what it wanted because prices weren't as low as what the company expected," the same trader said. "If CPC took only three [cargoes], that means that there are more cargoes left in the market," a source added. CPC officials could not be contacted for comment.
The weather in north Asia was relatively mild this week. Coupled with north Asian buyers choosing to focus on long-term contract discussions and annual delivery programs, the spot LNG market went into a lull after CPC's buy tender.
There are still pockets of demand remaining. State-owned PetroChina is seeking one April LNG cargo via a closed tender for the commissioning of its Rudong terminal in eastern China, several sources told Platts Friday.
"The cargo should be for either end April, or early May delivery, and PetroChina's buying idea is below $9.50/MMBtu," a source close to the company said. Another source said the closed tender was launched late last week but did not provide an exact date. PetroChina officials could not be contacted for comment.
The 3.5 million mt/year Rudong facility in the eastern province of Jiangsu will start up in April, a PetroChina spokesman said in mid-January.
The start of the Rudong LNG terminal will make PetroChina China's second LNG terminal operator.
A Middle Eastern buyer said he would bid Platts FOB Middle East plus $0.10/MMBtu for an April cargo. Platts FOB ME was assessed at $8.55/MMBtu Friday, implying a delivered price of $8.65/MMBtu. "Demand [for LNG] will only pick up in May through October but we can take cargoes before May as we have storage available," he said, "My preference is for a cargo from the region as shipments from Australia and Asia will result in lower cost savings."
Sources said that Indian buyers were looking to purchase cargoes for delivery in April.
Cold weather across north Asia could also trigger additional demand. "It's relatively mild in Tokyo now, but there will be a cold spell next week, and temperatures could drop to as low as 5 degrees Celsius," a north Asian buyer said, "That could result in some additional demand for LNG cargoes."
H2 March ended the week down at $10.10/MMBtu February 25, after starting the week at $10.20/MMBtu, with a backwardation of $0.10/MMBtu to H2 April Friday.
Platts' Asia Pacific Day Rate for LNG ship charters was stable across the week at $65,000/day.
