European Heat Wave Drives Up LNG Prices Amid Thin Storage and Middle East Supply Risk

The European heat wave has widened the price premium of liquefied natural gas (LNG) over Asia, as natural gas buyers in Europe increase their competitive bids for US LNG volumes. Despite easing cooling demand forecasts across both regions this week, thin storage and Middle East supply risk outweigh temperatures.

At a glance, the TTF holds a premium over JKM, and feedgas has recovered from maintenance lows. However, Edouard spares Gulf gas production.

The European heat wave is driving up demand for natural gas, which is not being met by local supply due to thin storage levels. This has led to increased competition for US LNG volumes, with European buyers raising their bids in an effort to secure supply.