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Worldwide gas prices have plunged to record lows in Europe and
Asia as lockdowns squeeze demand. Consumption of liquefied
natural gas (LNG) has remained stronger than gasoline demand as
LNG is used for power generation, but the cash crunch hitting
the global economy has cut demand.
The amount of gas flowing to U.S. LNG plants was on track to
fall to a nine-month low of 4.3 billion cubic feet per day (bcfd),
data provider Refinitiv said in a preliminary report Monday that
may be revised on Tuesday.
U.S. gas at the Henry Hub <0#NG:> in Louisiana has traded higher
than European benchmarks <0#TRNLTTF:> <0#TRGBNBP:> since the end
of April and was expected to remain more expensive through
September.
Most of the feedgas decline was at Cheniere Energy Inc's <LNG.A>
export plants at Sabine Pass in Louisiana and Corpus Christi in
Texas. Cheniere said it does not comment on operations.
Analysts said U.S. LNG feedgas has declined due to the recent
wave of cargo cancellations around the globe, after hitting a
record in February before most government-imposed lockdowns.
Buyers in Asia and Europe have already canceled over 20 U.S. LNG
cargoes for both June and July, and more cancellations are
anticipated.
Analysts at Energy Aspects said they expect around 125 U.S.
cargoes to be shut-in this summer, potentially slashing LNG
deliveries to Europe by up to 424 billion cubic feet compared to
what was expected at the start of the summer.
(Reporting by Scott DiSavino; Editing by Tom Brown)
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