EU LNG price reaches a new one-year high, attracting vessel diversions.

In December, the cost of LNG delivered to northwest Europe increased by USD 0.04, reaching USD 14.15/MMbtu (EUR 45.62/MWh) as of late Friday, marking the highest price since November 24, 2023, based on data from Spark Commodities. This figure exceeds the previous year's peak noted the week before. European LNG prices surged on Friday, following the rise in the TTF gas hub, which reached a one-year high after Gazprom revealed plans to reduce gas supplies to Austria's OMV. The front-month contract on the Dutch TTF closed on Friday at EUR 46.55/MWh (USD 14.44/MMbtu), its highest price in nearly a year. Meanwhile, Asian LNG prices have remained low due to weak demand, positioning Europe as the top premium market for LNG this winter, according to Kpler's Insight manager, Laura Page. The benchmark price for January LNG in Asia, based on the JKM marker, settled at approximately USD 14.25/MMbtu, while the December delivery settled at USD 13.58/MMbtu. Following Gazprom's announcement, at least six ships have confirmed they are rerouting to Europe instead of Asia, with four others appearing to do the same but not yet confirmed. Page noted that Asia is currently stable with minimal spot purchases from northeast Asian buyers. Total Asian LNG imports dropped for the third consecutive week, reaching 5.1 million tonnes based on preliminary data from Kpler. Nonetheless, Europe’s price increase is likely to intensify competition, according to a note from Australia’s ANZ bank, which stated that heightened competition with Europe has prompted some buyers to actively pursue LNG in the spot market.