Liquefied natural gas (LNG) buyers with long-term contracts are asking their suppliers for extra volumes of the super-chilled fuel pegged to oil prices which are currently much lower than spot prices, several trade and industry sources told Reuters.
Some have requested to load bigger cargoes bought under their long-term contracts instead of turning to the spot market to buy additional cargoes, or have asked for earlier delivery of the cargoes, the sources said.
"Oil-linked LNG prices are now about 25% cheaper than spot, so buyers are trying to optimise wherever they can and are buying only what they absolutely need in the spot market," a Singapore-based LNG trader said, declining to be named as he was not authorised to speak with media.
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| Spot LNG vs Brent-linked LNG prices |
Asian spot LNG prices are currently trading at about $20 per million British thermal units (mmBtu), the highest ever for this time of year, and may surpass the previous peak reached earlier this year during winter, especially if the weather turns colder than expected. read more
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