Asian spot LNG prices remain above $12 for eighth week running

LONDON, July 14 (Reuters): Asian spot liquefied natural gas (LNG) prices fell slightly last week, tracking European gas prices, amid muted Chinese demand but they remained above $12.00 for the eighth week running.
The average LNG price for August delivery into north-east Asia LNG-AS was at $12.10 per million British thermal units (mmBtu), industry sources estimated, down from $12.20/mmBtu the previous week, industry sources estimated.
Prices for September delivery were estimated at $11.80/mmBtu.
"Increased hydro(power) availability in China is pressuring demand, while economic indicators like inflation and producer prices are also not supportive of enhanced growth for the second half of the year," said Klaas Dozeman, market analyst at Brainchild Commodity Intelligence.
Dozeman said that the newest outlook for the La Nina weather pattern, which is characterised by cold temperatures in the Pacific Ocean during July-September, has weakened for the third consecutive month.
"A weaker La Nina typically decreases the need for winter restocking and decreases the risk of high gas demand in the U.S. and Asia, though major risk remains as any late summer heat in Asia might increase this need for LNG," he added.
In general, the Asia region remains balanced with rising temperatures in north-east Asia, and continuing monsoons in south and south-east Asia lowering the need for gas-fired power generation, said Charles Costerousse, senior LNG analyst at Kpler.
In Japan, high temperatures have added some upward pressure, with extra power demand and additional thermal power plants drawn into action. LNG stocks in terminal tanks have dropped as a result, said Alex Froley, senior LNG analyst at ICIS.
In Europe, underground stocks remain seasonally strong and strong renewables generation compared to last year has suppressed gas demand.