Asian LNG prices tumble as supply floods market

Traders say LNG cargoes may struggle to find a home. (AFP)
Updated 23 November 2019

Asian LNG prices tumble as supply floods market

  • Singapore’s Pavilion Energy has taken the unusual step of canceling the loading of a cargo from the US

SINGAPORE: Asian spot prices for liquefied natural gas (LNG) fell this week as a supply glut continued to weigh, while demand growth was muted by signs of a mild winter in Northeast Asia.

Prices for January delivery to Northeast Asia are estimated to be about $5.70 per million British thermal units (mmBtu), down 20 cents from last week for the same period, said several sources who are market participants.

With European gas storage nearly full, cargoes may struggle to find a home, traders said.

Singapore’s Pavilion Energy has taken the unusual step of canceling the loading of a cargo from the US, but has agreed to pay for it, several industry sources said.

A company spokeswoman said Pavilion evaluated scheduling and other commercial matters and took the decision not to lift the cargo in coordination with the supplier.

Supply was ample with several LNG plants offering cargoes this week.

Angola’s LNG project offered a cargo for delivery in January to as far as Indonesia, while Australia’s Ichthys and Papua New Guinea LNG plants offered a cargo each for December, sources said.

Indonesia’s Tangguh LNG plant, which is operated by oil major BP, also offered five cargoes for delivery over the first quarter of next year, sources added.

Some buy tenders from Thailand were finalized with PTT’s Singapore trading unit awarding a tender to buy more than 10 LNG cargoes for delivery over a year from March, 2020, a company official said.

State-run Electricity Generating Authority of Thailand (EGAT) has awarded its first spot tender to import LNG cargoes for delivery in December this year and in March next year, industry sources said.

It is also seeking government approval to import one more spot LNG cargo for next year, one of the sources said.

South Korea’s SK Energy and POSCO were jointly seeking a cargo for delivery in the second half of December, industry sources said, although further details of the tender were not immediately available.

Low spot prices also attracted some demand from India, with Indian Oil Corp. seeking a cargo for delivery on Dec. 17, industry sources said.

“The low prices may be creating some end-user demand in India which is attracting purchase interest in the international market,” a source familiar with the Indian market said.


Dubai counts on pent-up demand for tourism return

Updated 11 July 2020

Dubai counts on pent-up demand for tourism return

DUBAI: After a painful four-month tourism shutdown that ended this week, Dubai is betting pent-up demand will see the industry quickly bounce back, billing itself as a safe destination with the resources to ward off coronavirus.

The emirate, which had more than 16.7 million visitors last year, opened its doors to tourists despite global travel restrictions and the onset of the scorching Gulf summer in the hopes the sector will reboot before high season begins in the last quarter of 2020.

Embarking from Emirates flights, where cabin crew work in gowns and face shields, the first visitors arrived on Tuesday to be greeted by temperature checks and nasal swabs, in a city better known for skyscrapers, luxury resorts and over-the-top attractions.

Tourism chief Helal Al-Marri said that people may still be reluctant to travel right now, but that data shows they are already looking at destinations and preparing to come out of their shells.

“When you look at the indicators, and who is trying to buy travel, 10 weeks ago, six weeks ago and today look extremely different,” he said in an interview.

“People were worried (but) people today are really searching heavily for their next holiday and that is a very positive sign and I see a very strong comeback.”

The crisis crushed Dubai’s goal to push arrivals to 20 million this year and forced flag carrier Emirates, the largest airline in the Middle East, to cut its sprawling network and lay off an undisclosed number of staff.

But Al-Marri, director-general of Dubai’s Department of Tourism and Commerce Marketing, said that unlike the gloom after the 2008 global financial crisis, the downturn is a one-off “shock event.”

“Once we do get to the other side, as we start to talk about next year and later on, we see very much a quick uptick. Because once things normalize, people will go back to travel again,” he said.

The reopening comes as the UAE battles stubbornly high coronavirus infection rates that have climbed to more than 53,500 with 328 deaths.

And as swathes of the world emerge from lockdown, for many travelers their holiday wish lists have shifted from free breakfasts and room upgrades to more pressing issues like hotel sanitation and hospital capacity.

With its advanced medical facilities and infrastructure, Dubai is betting it will be an attractive option for tourists.

“The first thing I’m thinking is — how is the health-care system, do they have it under control? Do I trust the government there?” Al-Marri said. “Yes they expect the airline to have precautionary measures, they expect it at the airport. But are they going to a city where everything from the taxi, to the restaurant, to the mall, to the beach has these measures in place?”

Tourists arriving in Dubai are required to present a negative test result taken within four days of the flight. If not, they can take the test on arrival, but must self-isolate until they receive the all-clear.

While social distancing and face masks are widely enforced, many restaurants and attractions have reopened with business as usual, even if wait staff wear protective gear and menus have been replaced with QR codes.

“When it comes to Dubai, I think it’s really great to see the fun returning to the city. As you’ve seen, everything’s opened up,” Al-Marri said.