Continued LNG volatility could keep Singapore electricity, power generation prices high

THE latest bout of volatility in the liquified natural gas (LNG) market is coming from a war of sorts between Europe and Asia. Market watchers noted that Europe is now pricing itself as the "premium market" in order to attract supply, while anything left over is re-routed to Asia.

This situation has been going on for some time. According to S&P Global Platts Analytics, the Japan-Korea Marker's (JKM) daily physical assessment spent the majority of January priced below the Dutch TTF month-ahead contract. This is "a true rarity", the research group said.

Asia traditionally needs to price higher than Europe given the net-short position in the region, as consumption outweighs supply.