LNG Price in Asia Goes Nuts, Cargoes Fetching Record $34.47/MMBtu
Spot Asia-Pacific LNG prices hit a record high yesterday on “persistent supply constraints in global gas markets” and “strong winter restocking demand among Asian end-users.” The S&P Global Platts JKM price for November hit $34.47/MMBtu, the highest level for the Asian spot LNG price since it was launched in early 2009. Some Marcellus/Utica LNG goes to Asia, although most of it is under long-term contracts at much lower prices.
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You knew the NYMEX (and spot) price for natural gas couldn’t go up forever. There will be days when it falls, or “corrects.” Yesterday was a big correction as the NYMEX futures price dropped 7.36% (down $0.40)–the biggest single-day drop in the NYMEX price in nine months. Despite the big drop, most experts we’ve read believe this is a temporary correction and the price will continue to climb.
For years we have pointed out the botched strategy of New England politicians in blocking new pipelines to the region from the Marcellus. In the past during cold weather events, New England, which relies heavily on natural gas to generate electricity, has imported natural gas from our enemies in Russia in order to keep the lights on (see 
The price of natural gas, both the futures price at the Henry Hub NYMEX, and the spot price at hundreds of trading hubs across the country, continues to rise. The commodity price of natural gas has been the focus for a number of MDN posts in recent weeks. The question we’re often asked is, What will the price do over the next year or so? Will it stay this high? Will it decrease? We have two articles to share predicting what the NYMEX price of natural gas will be in the spring (and beyond). We think you’ll find both articles interesting. Let’s haul out the crystal ball…
Yesterday the “front month” October contract for the Henry Hub NYMEX price of natural gas soared 11% and settled at $5.706/MMBtu, the highest closing price since Feb. 21, 2014. Intraday trading went well over $6 per MMBtu. We keep seeing the word “contagion” as the main explanation for the soaring price. No, not the COVID contagion, but the psychological contagion of high prices globally. The price of natgas in Europe and Asia is skyrocketing (in the $25-$30/MMBtu range), which causes traders here to anticipate demand for our gas (via exports) will remain strong, driving up domestic prices. Ultimately fear drives the financial markets more than any other factor.
Yesterday we brought you the good news that two new LNG export facilities will, in all likelihood, begin full-scale operations by the end of this year (see 
The weather turning a bit cooler along with a three-week planned maintenance outage at the Cove Point LNG plant in Maryland is causing the spot price for natural gas in the Marcellus and Utica to fall precipitously. Of course the price recently, over the past few weeks, rose precipitously–so a sudden fall is not all that unusual. How much has the price fallen and how far will it go down?
MDN editor Jim Willis has had several conversations this past week about the price of natural gas and how prices in the Marcellus/Utica are influenced by national and international events. “Is it possible,” one questioner asked, “to say that if the NYMEX price is X, then my local trading hub in the M-U will likely be X plus or minus Y?” Unfortunately, the answer is no. There is no one “price” of natural gas. The Henry Hub futures price (the NYMEX) is often quoted as “the” price, but in reality, there are hundreds/thousands of prices. Natgas is a commodity and traded at hundreds of points along major pipelines throughout the country. This post attempts to explain more about the complex landscape of what influences the price of natural gas where you are.
The NYMEX futures price for natural gas hit yet another 7-year high yesterday, closing up $0.20 to close at $5.46/MMBtu. The national spot price average (for physically traded/delivered gas) was up $0.18 to an average of $5.53/MMBtu. According to Bespoke Weather Services, the reason for ongoing run-up in prices is fear: “It is all fear in the market, owing to storage levels that are viewed as less than sufficient in the event of a cold winter, not just here in the U.S. but even more so over in Europe.”
Once again we’re talking about the price of natural gas–both the NYMEX futures price and the physical spot price. Yesterday the NYMEX hit a new post-pandemic high of $5.26/MMBtu. The NGI national average for spot prices (physical gas traded at hundreds of trading hubs across the country) rose to $5.35/MMBtu. The spot price in the Marcellus/Utica in both the northeastern and southwestern portions of the play also rose to new highs and is (gasp) coming close to the levels we saw during February and Winter Storm Uri. Again we ask the question: How long will prices stay this high (or even go higher)? We have some insight on that question below.
Lately, we’ve brought you a number of articles about the price of natural gas, both the financial NYMEX futures price (from the Henry Hub), and the spot price gas fetches at various trading hubs around the Marcellus/Utica region. The price of gas matters. It drives higher royalties for landowners, higher profits for drillers, and ultimately whether or not there is an increase (or decrease) in drilling new wells. Yesterday was another historic milestone. The NYMEX futures price for the “front month” (October) closed over $5 per MMBtu. That’s the first time the closing price for the current NYMEX contract has been over $5 in seven years (since 2014).
Just two days ago MDN told you about whispers that the NYMEX price of natural gas may actually hit or surpass $5/MMBtu (see