ClickCease
US LNG Exports Hold Strong, Down from December’s Record Pace

US LNG Exports Hold Strong, Down from December’s Record Pace

US LNG producers are enjoying what is expected to be a short-lived bonanza as the confluence of depressed international liftings and colder than normal weather in Asia Pacific has recently boosted prices and arbs across gas markets.

18 January, 2021
Vortexa Analysts
Vortexa Analysts

US LNG producers are enjoying what is expected to be a short-lived bonanza as the confluence of depressed international liftings and colder than normal weather in Asia Pacific has recently boosted prices and arbs across gas markets.

US December LNG exports soar

December was a banner month for US LNG producers as they exported 6.24 million mt to international markets, an all-time record. January is shaping up to be a strong month, with 3.97 million mt of exports already in our tally, though loadings so far this month are behind December’s torrid pace.

data on cargo volume loaded per month by destination/trading region

US LNG Exports split by Trading Region (mt)

See this in the Vortexa platform

Our data show that global LNG liftings for December were 32.42 million mt, down 4.5% YoY.
Surging US LNG production in December was hitting a tightly supplied market, making the US barrels that much more valuable and incentivizing further exports.

Asia’s demand crunch

A colder than normal start to winter in Northeast Asia drove up regional gas prices and even led to electricity conservation efforts in Japan as utilities scrambled to find sufficient fuel for heating and electric demand. Further, South Korean importer Kogas sales to domestic consumers hit a three-year high in December on the back of similar conditions.

Taken together, shorter supply and stronger demand have driven prompt prices much higher in recent weeks, with Asian benchmark prices surging to all-time highs.

But considerable backwardation in pricing, especially in oil-linked deals, suggests the euphoria in spot markets may not last into the coming weeks.

Our roster for LNG liftings from US facilities the week ending January 22 shows just over 900,000 mt of departures, and this figure has been trending down since peaking north of 1.7 million mt in the week ending December 11.

 

 

Want to get the latest updates from Vortexa’s analysts and industry experts directly to your inbox?

{{cta(‘cf096ab3-557b-4d5a-b898-d5fc843fd89b’,’justifycenter’)}}

 


More from Vortexa LNG Analysis

In the News – LNG

Vortexa Analysts
Vortexa
Vortexa Analysts