Increased Demand Boosting Gas Prices

European LNG prices trended higher over Friday to be 3.6% higher at EUR 27.36 after a high of EUR 27.94 on signs of increased demand outside the region. They are now up around 10% this month as low prices attracted bargain hunters into the market and attacks on Russian refineries made energy markets nervous. Storage in Europe remains elevated with the end of the heating season approaching (end of March) and demand still soft but the focus has now shifted to refilling ahead of next winter.

• Low prices have attracted Asian buyers with many switching from other fuels to LNG. North Asian prices rose 2.2% on Friday to be up 10.3% in March to date. According to BloombergBNEF it will be more profitable to ship US LNG to Asia than Europe over May to July.
• US natural gas prices continued declining on persistent excess supply. They fell 0.6% on Friday to be down 9.4% this month. Data on Thursday showed that inventories are now more than 40% higher than the 5-year seasonal average. The weather is forecast to be slightly cooler over March 27 to 31 with parts of the Midwest and western US with below average temperatures, according to Atmospheric G2.