LONDON, Jan 3 (Reuters) - Asian spot prices for liquefied natural gas (LNG) were little changed this week amid quiet trade and low liquidity.
The average LNG price for February delivery into northeast Asia LNG-AS was estimated at around $5.10-$5.20 per million British thermal units (mmBtu).
“Demand is still weak following the Christmas and New Year holidays and there is plenty of supply,” an LNG trader said.
A new gas transit deal struck between Russia and Ukraine last month, which will see Moscow supply Europe for at least another five years, has eased market concern about gas supply disruptions.
Asian prices have reacted to a drop in European gas prices at the end of December partly in response to the new deal between Russia and Ukraine.
Last month, U.S. legislation to impose sanctions on firms laying pipe for Nord Stream 2, which aims to double gas capacity along the northern Nord Stream pipeline route to Germany prompted concerns about delays to that new gas supply. The gas flows were scheduled to start up in the first half of 2020.
In Europe, northwest terminal LNG send-out is still strong and gas storage levels robust but analysts say LNG send-out could decline over the next week or so.
The Dutch front-month contract, a benchmark for LNG arriving to Europe, is around $4.02/mmBtu, slightly lower than last week.
In Asia, warmer-than-normal and dry weather is forecast to largely continue in Japan and South Korea for the next ten days, while China were also experience higher-than-normal temperatures, which could depress demand for gas for heating.
U.S. LNG exporters had a record year in 2019 with exports up by more than 60%, but prices are seen remaining low in 2020, according to analysts, as another warm winter in Asia will cut heating demand and prompt Asian importers to divert cargoes to Europe, as they did last year.
Reporting by Nina Chestney. Editing by Jane Merriman