* High freight rates pushing cargoes to Europe instead of Asia
* Six LNG tankers floating cargoes in Singapore, Malaysia -traders
* H-Energy, KOMIPO seek mid-term supply cargoes
By Jessica Jaganathan
SINGAPORE, Oct 26 (Reuters) - Asian spot prices for liquefied natural gas fell to an over two-month low this week amid increased supply and lower demand especially in Japan which is expecting a warmer-than-usual winter and the restart of nuclear reactors.
High freight rates are also weighing on Asian demand, with deliveries of LNG heading to northwest Europe instead.
December spot LNG LNG-AS fell to $10.20 per million British thermal units (mmBtu), the lowest since Aug. 10. Bids and offers were far apart, while the price spread between December and January was estimated at about $1 per mmBtu.
Illustrating the tepid demand, a fleet of half-a-dozen tankers carrying unsold LNG has been floating in Singapore and Malaysian waters for up to two weeks, traders said this week.
The ships are carrying a total of around 1 million cubic metres of LNG, worth more than $200 million at current spot market prices.
The LNG cargoes were purchased ahead of the northern hemisphere winter season in a strategic move but are now failing to find buyers, several traders told Reuters.
Falling appetite for LNG in Japan, the largest importer of the commodity globally, will contribute to slower Asian demand-growth as gas is replaced by nuclear energy.
A court in Japan on Friday paved the way for Shikoku Electric Power Co to restart its only operable nuclear reactor, rejecting a lawsuit from residents to close the unit.
Japan is expected to have about 9 gigawatts (GW) of nuclear capacity online by this winter compared with 3.5 GW last winter, FGE said earlier this week.
Companies from China, whose gasification push last winter helped push up spot prices to 2014 highs, have also been securing term supplies to meet anticipated demand increases instead of waiting until winter to procure LNG, which is weighing on spot prices.
With freight rates soaring to 6-year peaks, near record-high LNG deliveries are heading to Europe.
Ports in northwest Europe will have received 2.6 million tonnes of LNG by the end of the month, the highest for any time of the year since Refinitiv Eikon shipping data began in 2013.
Focus this week was on mid-term deals with companies from South Korea and India issuing tenders.
South Korea’s Korea Midland Power Co Ltd (KOMIPO) is seeking up to 20 cargoes for delivery over five years from 2020, while sources said India’s H-Energy is looking 17 cargoes for delivery over 2019 to 2022.
On the supply front, Cheniere Energy expects to see the first LNG from its Corpus Christi project soon, a senior executive said earlier this week. (Reporting by Jessica Jaganathan Editing by Joseph Radford)