US LNG Exports To Europe Continue To Fall

Exports to Europe constituted just 45% of all US LNG exports in July according to Kpler, amid a continued fall from 65% in May and 52% in June.

• In total, 2.6m mt of LNG went to Asia in July, compared to 3.3m mt to Europe.
• US flows to Asia have been growing as the natural gas market in Europe remains subdued, while Asian prices are now around a $2.1/MMBtu premium over Europe, compared to 30 cents/MMBtu in June, according to ING.
• The flow of LNG cargoes East is expected to trim the supply glut for European LNG and tighten the market in the Atlantic. While that could help bolster an increase in Europe’s gas prices in the winter - as heating demand grows – gas storage levels in Europe are at 85.4% capacity as of July 30, compared to 68.93 for the same period last year.
• Europe is therefore well on track to hit the mandated 90% storage capacity by November 1, which should reduce the demand for additional LNG supplies.