Global LNG Imports To Rise in October on Heating Demand

Global LNG imports are forecast to rise by 2% month on month in October to 31.3mn tons. This is up from 1% year on year according to BNEF.

• Floating storage could unload as delaying discharge further into the season is not in the money. LNG on water for at least 20 days rose by 39% on the week to 4.02mn tons as of 1 October, the highest since end-November.
• Northwest Europe’s imports are projected to recover from weak September volumes as heating season slowly sets in. Imports into Northwest Europe and Italy are expected to rise by 1.5mn tons on the month in October to 5.9mn tons.
• North Asia is holding the netback premium over Europe for spot US cargoes and is expected to raise imports. LNG imports into Mainland China are set to rise to 5.6mn tons in October due to growing gas consumption. This compares to 5.1mn tons in September.
• South Korea could see higher LNG imports month-on-month to 3.2mn tons, up by 0.2mn tons month on month, to meet heating needs, despite the start of a new nuclear reactor replacing some gas demand for power. LNG stockpiles are estimated to have reached 5.3mn tons by end-September according to Bloomberg and Kogas sales data.
• Japan’s imports are forecast to decline by 0.6mn tons on the month to 4.9mn tons in October, assuming inventory injections slowdown in October. Total storage was estimated at 5mn tons as of end September.
• Global LNG supply is forecast to rise by 6% on the month to 35.3mn tons in October, as major maintenance work around the world has mostly concluded. This is also driven by the return of Egyptian exports and a rise in Australia’s exports from the North West Shelf after maintenance.