A winter hangover grips the market, but optimism and uncertainty keeps minds focused! February was a month to test the patience of many a trader, with Chinese New Year zapping liquidity and bids hard to come back, cargoes were floating to Europe (those that were left post the US winter freeze) as netbacks did nothing to whet appetites. A continuation of talk around 2021 storage restocking and a potential resurgence of demand from China was, and is yet to materially hit the market, which has seen spot prices erode further into the $5/MMBtu range. India has kept food on the table for some, as high oil prices pushed the switch to LNG as demand tenders from most users was lighting up the newsreel. There is a lot of pent-up expectation ahead of us this year, with demand forecasts rising and optimism aplenty – we do however need to get through summer, with prices depressed and differentials curtailing risk appetites and trading.
Authors: Tobias Davis and Patricia Roberts
If you would like to subscribe to the full monthly report (around 25 pages) , plus optional spreadsheets on spot tenders, please contact us at TJDavis@tullettprebon.com.sg