Last week’s gains have been erased starting with fears of further escalation in the Middle East easing and comfortable supply. We are now however entering a period a significant Norwegian maintenance whilst temperatures are still below seasonal norms with low wind generation increasing gas for power demand. Despite the additional demand, gains have not resumed as the temperatures are expected to improve as we enter May. There has also been some positive news from the U.S. with the first tanker in 12 days setting sail from major LNG export terminal Freeport on Tuesday, signalling the resumption of gas processing after an outage this month that raised concerns over supplies. Latest reports are also showing with Asian LNG prices at 3-month highs, demand may have started to wane from price-sensitive buyers such as India and China. This is because at prices above $10/mmBtu imported LNG finds it hard to compete with other fuels in domestic markets. With gas markets expected to be tighter over the coming week and potential storage withdrawals the market will pay close attention to unplanned outages and planned maintenance as this could drive price direction.
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