The figure reflects the daily JKM assessment published by Platts, a leading global energy, petrochemicals and metals information provider and a premier source of benchmark price references, between January 18 and February 15, expressed as a monthly average.
Despite supply disruptions which tightened prompt availability towards the end of the trading month, the market still fell 28.2 per cent year over year, with buyers struggling to manage high inventories.
At $5.339/MMBtu, the JKM for March delivery is at the lowest monthly-average levels seen since September 2009, when the monthly-average for October delivered cargoes was below $6/MMBtu at $5.130/MMBtu, Platts historical records show.
The JKM had begun the trading month at $5.675/MMBtu before sliding to intra-month lows of $4.95/MMBtu; the first time the marker had dropped below $5 since summer 2009. Supply from various facilities, coupled with news of an impending restart of production at Angola LNG, continued to outweigh demand that was mainly concentrated in the Middle East and Indian region.
Prices rebounded on news of production issues at Russia’s Sakhalin-2 facility, which culminated in a force majeure, following a power problem in the facility’s liquefaction plant. This forced prices back up to the $5.80/MMBtu mark, as buyers were forced to return to the market in order to replace prompt cargoes, causing a scramble for supply. However, the rebound in prices was short lived, with prices falling to $5.30/MMBtu by February 15.
“Prices rebounded at the beginning of February due to the outage at Sakhalin, with several deals heard done around the $6/MMBtu for prompt delivery, which reopened the arbitrage between the Atlantic and Pacific basins, even making European reloads workable for a short time,” said Max Gostelow, pricing analyst of Asia LNG at Platts.