Mediterranean LNG imports drop in 2024 on strong renewables, subdued LNG pull

Imports of LNG into the West and East Mediterranean regions saw a sharp year-over-year drop in 2024, according to S&P Global Commodity Insights data, with a growing supply of renewables and strong pipeline flows depressing appetite for waterborne LNG cargoes.

Total LNG imports into the West Mediterranean -- Spain, Portugal, South of France -- and East Med -- Turkey, Greece, and Croatia -- stood at 46.73 million mt, or 761 cargoes, for 2024 according to the data. This was the lowest imports into the Med since 45.41 million mt, or 764 cargoes, in 2021.

This also compared to the 56.08 million mt, or 909 cargoes, in 2023 and 61.36 million mt, or 1,024 cargoes, in 2022.

Of the total LNG imported by the West and East Med in 2024 so far, the largest volume arrived from the US at 17.23 million mt, followed by 10.84 million mt from Algeria. Notably, 5.94 million mt arrived from Russia, 5.91 million mt from Qatar and 3.96 million mt from Nigeria.

The fall in imports was spearheaded by Spain, which saw around a 25% fall year over year to 13.84 million mt in 2024. The country saw growing wind and solar generation, which helped ease gas-fired power generation demand. Milder temperatures for parts of winter also depressed residential and commercial demand.

In addition, Spain looked to utilize its underground storages and healthy pipeline flows from France to satiate quick upticks in domestic demand and counter strong LNG pulls from the premium NBP and PSV markets during the last quarter of 2024.

Net imports from France via the Pirineos interconnection point totaled 223 million cu m Oct. 1-Jan. 7, whereas Spain was a net exporter of gas to France by an order of 452 million cu m over the same period last year.

Following similar trends in Europe amid a tight LNG market, net withdrawals from Spain's underground storages between the start of the heating season until Jan. 7 averaged 72.89 GWh/d, compared with 38.7 GWh/d and a net injection rate of 13.5 GWh/d over the same period one and two years earlier, respectively, according to Gas Infrastructure Europe data.

This left natural gas storages 79.9% full with 28.63 TWh stored Jan. 7, which represents a 20.3% fall from the 35.9 TWh seen at the start of the heating season Oct. 1, the latest GIE data showed. In comparison, storage fell 11.12% in 2023 and was up 4% in 2022 over the same period.

Countries across the Med saw a spur of spot buying towards the end of the first half of winter in December, to secure supply ahead of the expiration of the Russia-Ukraine transit agreement. This led to higher spot prices as Med participants looked to lure in cargo volumes away from other competitive demand hubs.

Platts, part of Commodity Insights, assessed the Mediterranean LNG marker for February at $13.485/MMBtu Jan. 8, stronger than the $9.286/MMBtu seen the same time last year, and at a 23 cent/MMBtu discount to the Dutch TTF valued at $13.715/MMBtu.

Med LNG prices were at a 24.4 cents/MMBtu discount against PVB -- the Spanish gas hub price lastly assessed at $13.729/MMBtu.

Platts assessed the East Mediterranean Marker for August at $13.645/MMBtu Jan. 8, a 13 cents/MMBtu premium against the Northwest European LNG marker.

East Med LNG prices were at a 7 cent/MMBtu discount against TTF, and a 52.8 cents/MMBtu discount to the Italian PSV gas hub.

Delivered LNG volumes to Italy over 2024 came in at around 10.69 million mt, down 11.2% from the 12.03 million mt recorded over 2023, Commodity Insights data showed.

However, with total import capacity expected to reach some 28 Bcm/year by 2025 alongside the start of the Ravenna FSRU in early April, Italian transmission system operator Snam believes that LNG imports could cover one-third of the country's annual gas needs in the coming years.