February NWM traded for 300 lots versus JKM, as futures activity increases: sources

The LNG North West Europe Marker (Platts) Futures Contract, NWM, traded for 300 lots Oct. 31, a February trade at a $2/MMBtu premium over JKM, the benchmark price reflecting spot deliveries of LNG to Northeast Asia, according to market sources.

The NWM trade was heard at $32.50/MMBtu, while JKM traded at $30.50/MMBtu, market sources said.

TFS said it brokered the Oct. 31 transaction. It declined to name the counterparties. Major market participants were said to have been involved, according to multiple market sources. The contract size is 10,000 MMBtu and monthly contracts began being listed Oct. 24 by CME for the current year and the next five calendar years.

The February trade followed a trade on January, for 5 lots, on the first day of the CME futures contract, and three bids on January in the days after that, including a January NWM bid Oct. 31 heard at Dutch TTF minus $12/MMBtu. The contract is cash settled against the Platts DES Northwest Europe physical assessments.

The activity comes as the decoupling between European LNG and inland natural gas markets continues. Platts assessed December DES Northwest Europe at a $11.25/MMBtu discount versus TTF December Oct. 31. For the Platts DES Northwest Europe LNG daily forward curve that prices 11 months into the future, the December DES NWE derivative was assessed at $24.192/MMBtu Oct. 31, or a $11.50/MMBtu discount to TTF.

January was assessed at $30.429/MMBtu, a discount of $7.31/MMBtu to TTF; February at $31.629/MMBtu, a TTF discount of $6.187/MMBtu; and March at $29.656/MMBtu, a TTF discount of $7.835/MMBtu.