Oxford Energy Podcast – Asia LNG Price Spike: Perfect Storm or Structural Failure?

In this Podcast David Ledesma discusses with Mike Fulwood these issues as well as other more structural factors that exacerbated the market situation. Lack of any meaningful gas storage in Asia, especially in a country like Japan, meant that the market did not have any back-up storage and the fragmented nature of the Japanese market, with few pipeline interconnections between the main cities and regions, meant gas could not be moved around the country at short notice.  The depletion of gas storage levels in Europe on December a 2020, and January 2021, as LNG cargoes were diverted away from Europe to Asia, effectively meant that storage capacity in Europe actually replaces the lack of gas storage in Asia. The podcast also discusses the lack of a liquid physical trading market in Asia, compared to Europe and North America, and whether the price spike could have implications for the possible use of price benchmarks such as Platts JKM, in contracts, whether short, medium or even long-term.

Listen to podcast

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