GLOBAL LNG-Asia spot LNG prices down as US pauses Iran attacks
By Marwa Rashad
LONDON, March 27 (Reuters) - Asia spot liquefied natural gas prices dropped this week after U.S. President Donald Trump extended a pause in attacks on Iran's energy plants but raised fears of further escalation by dispatching thousands of troops to the Middle East.
The average LNG price for May delivery into north-east Asia was estimated at $19.30 per million British thermal units (mmBtu), industry sources said, down $6 from $25.30/mmBtu in the previous week, which was the highest level since end-December 2022. Prices are still up over 85% from their pre-war levels.
"The panic bid has mostly faded, but structural tightness will remain. However, spot is being tempered by an absent China and a priced-out South Asia," said Toby Copson, managing partner at Davenport Energy.
"Europe doesn’t appear short yet, but the refill curve is now. And with a decent chunk of supply removed, we will see some more forced buying," he added.
On Thursday, Trump posted on social media that he would pause his threat to attack Iranian energy plants for 10 days until April 6.
Polish Prime Minister Donald Tusk, however, said on Friday there were reasons to believe the coming days could see an escalation in the conflict, which began when the U.S. and Israel launched strikes on Iran late last month.
"Once this deadline approaches, the geopolitical risk premium will be rebuilding again," said Klaas Dozeman, market analyst at Brainchild Commodity Intelligence.
"All of these developments are now of more importance than, for instance, the warm weather in Asia or colder weather in Europe or the not-so-bad economic numbers of this week. As long as normal transport is impossible, a certain risk premium should remain," Dozeman added.
Martin Senior, head of LNG pricing at Argus, said fuel switching and demand destruction continues across South Asia, as high prices have incentivised higher coal burn and priced out demand.
Requirements from most Asian countries are coming from the prompt, with most buyers apart from Taiwan not purchasing much beyond April and May, he added.
In Europe, gas prices at the Dutch TTF hub were hovering around 55 euros per megawatt hour on Friday afternoon, 72% higher than pre-war levels.
Prices are trending sideways even as hedge funds add length at an alarming rate, betting that momentum will whipsaw higher as an inevitable supply crunch ripples out from South Asia, said Seb Kennedy, independent analyst at Energy Flux News.
"Investment funds have gone from shorting TTF at the start of 2026 to building a near-record net long position in TTF futures in just a few weeks. If and when U.S.-Iran peace talks collapse, the correction could be dramatic," he added.
S&P Global Energy assessed its daily Northwest Europe LNG Marker price benchmark for cargoes delivered in May on an ex-ship (DES) basis at $18.444/mmBtu on March 26, a $0.395/mmBtu discount to the price at the TTF hub.
Argus assessed the price at $18.91/mmBtu, while Spark Commodities assessed the price for April delivery at $18.232/mmBtu.
In global LNG freight, Atlantic rates dropped to their lowest level since the war, at $96,500/day, largely driven by the arbitrage to Asia being firmly closed, incentivising U.S. cargoes to remain within the Atlantic basin and thus increasing vessel availability, said Spark Commodities analyst Qasim Afghan.
Pacific rates dropped to $108,000/day.
