Winter Gas Price Surge Looms as Europe and Asia Compete for LNG Supplies

The European gas market is facing an unusual level of pressure heading into winter, as the region needs to secure more liquefied natural gas (LNG) than normal due to low storage levels.

According to recent data, Platts JKM, the Asian benchmark LNG price, reached almost $30 per million British thermal units in mid-September and trades at $25.29 on Friday, while European deliveries are at $24.62 per MMBtu.

This increased competition for winter supplies is expected to drive prices higher as both Europe and Asia try to secure LNG cargoes in a tighter market.

Developing Asian economies, such as Pakistan and Bangladesh, that were previously priced out of the market during the 2022 energy crisis are now willing to pay elevated rates to avoid economic disruption, according to Takayuki Ueda, chief executive of Japan's Inpex Corporation.