Reuters reported that Japanese steel giant Nippon Steel has recently purchased a liquefied natural gas shipment at the highest price ever paid in the country amid growing fears of disruptions of LNG supplies from Russia. The report quoted sources as saying that Nippon Steel bought an LNG cargo for delivery in September at a price of USD 41 per million British thermal units, most likely supplied by a major trading house. The source said “Based on a standard Liquefied Natural Gas Carrier sized vessel, the cargo would cost USD 132-135 million depending on load tolerance.”Competition to secure LNG cargoes has intensified since Russia's invasion of Ukraine. Europe is buying massive amounts of LNG, further increasing market tightness and elevating prices. Resource-poor Japan faces a historic energy security risk as tensions with Moscow intensify; heightening the threat of gas supply disruptions at a time when global supply is tight and spot prices are sky-high. Japan, a top LNG importer, relies mainly on long-term LNG contracts, which are usually much cheaper, but utilities have been forced into the spot market over the past few months to meet summer cooling demand amid above-average summer temperatures and concerns over Russian supply.Russia has recently seized full control of the Sakhalin-2 gas and oil project in its far east, in which Shell & Japanese investors hold just under 50%.
Reuters reported that Japanese steel giant Nippon Steel has recently purchased a liquefied natural gas shipment at the highest price ever paid in the country amid growing fears of disruptions of LNG supplies from Russia. The report quoted sources as saying that Nippon Steel bought an LNG cargo for delivery in September at a price of USD 41 per million British thermal units, most likely supplied by a major trading house. The source said “Based on a standard Liquefied Natural Gas Carrier sized vessel, the cargo would cost USD 132-135 million depending on load tolerance.”Competition to secure LNG cargoes has intensified since Russia's invasion of Ukraine. Europe is buying massive amounts of LNG, further increasing market tightness and elevating prices. Resource-poor Japan faces a historic energy security risk as tensions with Moscow intensify; heightening the threat of gas supply disruptions at a time when global supply is tight and spot prices are sky-high. Japan, a top LNG importer, relies mainly on long-term LNG contracts, which are usually much cheaper, but utilities have been forced into the spot market over the past few months to meet summer cooling demand amid above-average summer temperatures and concerns over Russian supply.Russia has recently seized full control of the Sakhalin-2 gas and oil project in its far east, in which Shell & Japanese investors hold just under 50%.
