April Asian LNG MOC sees record activity as JKM prices come off highs

Activity in the Platts Market on Close (MOC) cargo and derivatives assessment process for Asian LNG reached unprecedented highs during the pricing period for April deliveries as JKM prices posted a decline on the month.

The Platts assessed JKM -- the benchmark price reflecting LNG delivered to Northeast Asia – averaged $13.644/MMBtu during the April pricing period from Feb. 17-March 14, down by 8.7% from the March JKM pricing period, which saw JKM surge to multi-month highs.

The total number of bids, offers, and trades in the cargo MOC assessment process during the April pricing period reached a record high of 388, up by 37.6% month-on-month and 139.5% year-on-year.

The previous high was recorded during the pricing period for January 2025, when bids, offers and trades totaled 367.

There were 201 bids, 174 offers, and 13 trades for H2 March, April and May deliveries, with 16 entities involved.

Specifically, 10 entities reported 12 trades for April deliveries into the Japan-Korea-Taiwan-China region and one trade for delivery into South Korea on a DES basis, amounting to approximately 845,000 mt of LNG.

Out of the 13 trades, six were linked to the JKM balance-month (balmo-ND) contract, three were linked to the JKM full-month average contract, and the remaining four were executed on a fixed price basis.

For JKM-linked trades, all trades were priced against the balmo-ND contract, with the average cash differentials of the trades at 3.7 cents/MMBtu.

The majority of bids and offers were index-linked, with 65.0% tied to the JKM full-month average, JKM balmo-ND or the Dutch TTF index. This marks an increase from the March pricing period, when 59.3% of total bids, offers, and trades were index-linked.

The average cash differential of all bids and offers was at a 4.2 cent/MMBtu premium against the malmo-ND contract. This compares with an average cash differential during the pricing period for the March JKM of minus 3.1 cents/MMBtu.

The fall in Asian spot LNG prices was largely attributed to bearish market sentiment as participants evaluated the potential resumption of Russian gas supplies to Europe amid Russia-Ukraine peace talks.

Fundamentally, demand for spot cargoes across the Northeast Asian region remained relatively weak as the market entered the shoulder season.

Market sources noted that buying interest was predominantly focused in South Korea, where state-owned Kogas reportedly secured additional cargoes for May delivery, supplementing earlier purchases made for March and April. According to market sources, these recent purchases total between seven and 10 cargoes.

Meanwhile, Japanese companies were heard to be optimizing and capitalizing on the contango structure between April and May, while Chinese companies stayed on the sidelines as spot prices remained unattractive relative to domestic trucked LNG and pipeline gas prices.

Market participants are closely monitoring the approaching summer season, as weather conditions will significantly influence demand from Southeast and South Asian importers.

Derivatives MOC activity

The number of bids, offers and trades reported during the derivatives Platts MOC assessment process in the April JKM pricing period totaled 1,622, up 3.3% month-over-month and 70.4% year-over-year to a four-month high.

The derivatives MOC was last seen more active in the pricing month of December, which saw a total of 1,885 bids, offers and trades.

The majority of the activity -- 627 bids, offers, and trades -- was for the JKM balmo-ND.

A total of 162 trades for the April, May and balmo-ND contracts of 250,000 MMBtu each were reported by 20 entities, namely ADNOC Trading, BP, Cheniere, Chevron, Dare, DGI, Engie, Freepoint Commodities, Glencore, Gunvor, Jera GM, Marubeni, PetroChina, SEFE, RWE, Shell, TotalEnergies, Trafigura, Unipec and Vitol.

Over the Feb. 17-March 14 period, financial exchanges recorded healthy liquidity, with LNG futures trading volumes cleared on financial exchanges totaling 92,681 lots, according to exchange data. This is equivalent to approximately 17.82 million mt, or 281 cargoes.