LNG Cargoes May Divert Away From Spain on Prices

Mediterranean LNG is currently trading at a small discount to NW Europe due to high gas inventories in Spain paired with lower demand and higher renewables according to Blomberg.

• Mediterranean LNG is trading $0.10/mmbtu below levels in NW Europe, which is historically unusual, global director for LNG at S&P Global Commodity Insights, said Ciaran Roe said.
• Spain’s gas demand so far this month is about 8.5% below the same period last year, driven by a 39% slump in consumption from power generation, according to Enagas. That follows the same trend from October, when demand tumbled due to higher generation from renewables.
• However, latest forecasts from Enagas showed demand in Spain ins expected to pick up in the next two months.
• Spanish LNG inventories risen further above the five-year average range according to Bloomberg data.
• The country’s underground gas stocks remained at 100.42% of capacity as of 25 November. Spain has not begun storage withdrawal season yet, GIE data showed.