Karachi October 11 2021: Pakistan may consider only relying on term supplies should current spot prices remain elevated, an industry source told Reuters.
Pakistan monthly buy on average five LNG cargoes on spot to meet its energy requirement. Pakistan Qatar LNG contract had been for 15 years, 500MMCFD (five ships a month) at the rate of 13.37 percent of Brent. While Pakistan LNG had Two contracts of 100 MMCFD each one at 11.62 and the other one at 11.95 percent.
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Under the new agreement, which will be effective from January 2022, Qatar will initially deliver two ships (containing a total of around 200MMCFD of LNG) a month. Later, the supplies will be enhanced up to four ships (400MMCFD) at the rate of 10.2 percent of Brent.
Asia liquefied natural gas (LNG) prices soared this week, as the world's top buyer China faced an ongoing power crunch and low inventory in Europe drove up competition for the super-chilled fuel.
The average LNG price for November delivery into Northeast Asia was estimated at about $37 per metric million British thermal units (mmBtu), up nearly 16% from the previous week, industry sources said.
December delivery prices were estimated to be about $38 per mmBtu, they added.
Price agency S&P Global Platts' Japan-Korea-Marker (JKM), which is widely used as a benchmark in the spot market, had surged to a record high of $56.326 per mmBtu on Wednesday, before easing later in the week.
"The market is still very bullish for winter and any piece of headline is driving up sentiment," a Singapore-based trader said.
Gazprom's China-focused Amur gas processing plant in Russia's Far East has halted operations after a fire early on Friday, a spokesman for the plant told Reuters.
The broader implications were not immediately clear, but the plant plays an important part in Russian gas exports to China, which has been hit by electricity shortages that have led to power rationing across the country.
Bangladesh bought on LNG cargo from Vitol for delivery in mid-October at $35.89 per mmBtu and another from Gunvor for late October delivery at $36.95 per mmBtu, which are the highest prices paid by the country for spot cargoes, an official of state-run Petrobangla said.
Freight rates to ship LNG rose this week and are at multi-month highs as the increase in LNG demand has driven up the need for vessels to move supplies, sources said.
Production issues at Sakhalin and Indonesia are also supporting prices, a Singapore-based source said.