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US LNG exports increase in August as Europe grabs cargoes before winter

According to preliminary data from financial firm LSEG, U.S. liquefied 'natural gas' exports increased slightly in August after major plants in Texas completed maintenance. Moreover, European buyers increased their purchases in order to replenish gas inventory ahead of the winter.

LSEG ship tracking data shows that the United States exported 10.7 metric tons (MT) of LNG in August, compared to 10.48 MT for July.

Freeport LNG, America's fourth largest LNG export facility, completed maintenance on its Texas facility. Cheniere Energy, the third-largest facility in the United States, also completed planned work.

The top destination for U.S. exports was Europe, which imported 5.84 MT or 55%, of the total. This was an increase of more than one metric ton over July as buyers sought to replenish storage before winter heating season.

The premium for Asian LNG was reduced by the stronger European demand compared to European benchmarks. The Japan-Korea Marker (the benchmark for Asian LNG) averaged $22.00 a million British thermal units in August. This is up from $19.10 a month earlier.

Asia was the second-largest export market for U.S. Liquefied Natural Gas (LNG), taking 2.59 MT, down from 3.32MT in July. This is because European buyers were more aggressive in competing for available cargoes.

During the second quarter earnings call, executives at Cheniere, Venture Global and the other U.S. LNG companies said that they expected strong LNG prices and demand through the end the year as Europe continues its inventory rebuilding and the colder weather increases consumption.

The ongoing conflict between the United States and Iran has made it difficult to rebuild Europe's stocks. The ongoing conflict between the United States and Iran has caused a restriction on the shipments of super-chilled gas across the Strait of Hormuz.

Exports to Latin America increased to 0.9 MT as the winter season boosted demand. Two cargoes were shipped to El Salvador - a country that the U.S. only rarely supplies LNG to - and one cargo from Venture Global’s Plaquemines LNG Plant in Louisiana was sent to Trinidad and Tobago.

Trinidad and Tobago, Latin America's biggest LNG exporter, does not usually import LNG. In August, the country exported 0.83MT of LNG. Six of the 12 cargoes were bound for Europe. Producers in Europe also wanted to take advantage of strong European demand.

Egypt remained a major buyer of U.S. 'LNG in August. It imported 0.61 MT or 6% of the total U.S. LNG Exports. This is similar to what it imported in July.

Around 0.76 MT or 7% U.S. exports of LNG remained in the water, without a publically identified final destination. This suggests traders are still searching for the most lucrative markets for these cargoes.

(source: Reuters)