The Platts LNG Japan Korea Marker for August ended the Asian trading at $11.925/MMBtu Friday, falling 10 cents on the week, as the result of the recent North West Shelf tender weighed on the market sentiment.
Demand from end-users remained limited due to high stocks and ample supply kept the lid on the market. Bids for August cargoes have ranged from less than $12/MMBtu to low $11s/MMBtu, while offers were seen remaining above $12/MMBtu.
Buyers who have space to take additional cargoes were waiting for the market to settle as their procurement practices could come under scrutiny.
In the latest closely-watched North West Shelf sell tender, multiple cargoes were heard to be awarded at prices in the $11s/MMBtu, weighing down on the market sentiment. Multiple parties were identified as winners including BG, BG, Itochu, Woodside, Statoil, and Trafigura, although this could not be confirmed.
A couple of cargoes from Russia's Sakhalin were also sold to Japanese buyers at below $12/MMBtu, sources said. Sakhalin is said to have one cargo available for September.
Sizable volumes appeared to be still available from Indonesia's Bontang LNG plant. Platts last month reported that Bontang LNG expects to have 18 excess cargoes over 2014-2015 following the expiry of a 2 million mt/year LNG contract with Korea Gas Corp. in June.
Furthermore, as many as four cargoes were being offered from PNG LNG, sources said.
Meanwhile, the number of available cargoes in the Atlantic Basin has been scaled back due to weak prompt summer demand, market sources said. With spot prices in Asia remaining soft, supplies were holding back volumes until confidence improve.
Some negotiations for winter cargoes have already started.
Sources said suppliers have marketed summer and winter cargoes together or autumn and winter cargoes together to entice buyers. Still, some sources said no firm demand for winter delivery has seen yet.
