Higher Prices Limit Indian LNG Spot Procurement

Indian spot LNG procurement is failing to pick up amid higher prices, which is weighing on Asian LNG spot prices, that eased back from seven-month high earlier this week.

• Asian LNG prices have been easing back from seven-month highs earlier this week of $15.78/mmbtu, as Indian spot demand eased due to prices and interest from Japan and South Korea is failing to significantly lift prices.
  • JKM Oct 23 down 0% at 14.53$/mmbtu
• Several Indian importers began to show interest in the LNG spot market, but many tenders did not get awarded. Indian spot buyers tend to be price sensitive. Gail did not buy an LNG cargo eyed for end October delivery to the Dabhol terminal, and India’s Gujarat State Petrolum Corp also did not purchase an LNG cargo for end-Oct delivery according to Bloomberg.
• Gail purchased an LNG cargo on a DES basis for Oct. 1-10 delivery to the Dahej terminal on India’s west coast at the mid-$12/mmbtu level, according to two traders familiar with the matter.
• BNEF forecasts India’s LNG demand in winter 2023-24 will be 10% more than a year earlier due to start of the Dhamra terminal and resumption of regular supply of contracted cargoes under a contract with a former Gazprom unit, which had stopped last year after Russia’s invasion of Ukraine.