By Juliet Ezeh
A sharp rally in Asian liquefied natural gas prices has triggered intense competition for available cargoes, with buyers in the region increasingly turning to alternative suppliers such as Nigeria to secure supply.
Market analysts say the tightening global LNG market is being driven by supply disruptions in the Middle East and rising geopolitical tensions, factors that have pushed Asian benchmark prices to their highest level in about three years.
Data from S&P Global Platts showed that the Japan-Korea Marker, the benchmark for spot LNG cargoes in Asia, climbed to $25.393 per million British thermal units for April delivery last week. The spike has widened the price gap between Asian and European markets, encouraging traders to redirect shipments toward buyers willing to pay higher premiums.
The surge in prices has forced several Asian countries to intensify their search for new sources of gas. Government officials told Reuters that India has begun scouting for replacement cargoes following supply disruptions from Qatar, while Bangladesh’s state-owned energy firm, Petrobangla, is preparing to issue tenders for prompt LNG deliveries.
Energy analysts say the Asia-Pacific region is likely to dominate near-term demand in the spot market as utilities and governments scramble to secure supplies to cushion potential shortages.
The rush for LNG cargoes comes as Qatar, one of the world’s largest exporters of the fuel, faces production disruptions that have tightened global supply. Asian buyers traditionally rely heavily on Qatari shipments, which account for more than 80 per cent of the country’s exports, according to data from analytics firm Kpler.
With supply constrained and demand rising, the widening price differential between Asia and Europe has created strong incentives for traders to divert flexible cargoes toward the Pacific basin.
Industry experts note that Nigeria, through the Nigeria LNG facility in Bonny Island, is among the exporters positioned to benefit from the surge in Asian demand. Cargoes from the Atlantic Basin can be redirected depending on market signals, particularly when destination clauses allow flexibility.
Analysts say if Asian LNG prices remain significantly higher than those in Europe, the region could continue attracting cargoes originally intended for Atlantic destinations in the coming weeks.
They also warn that the tightening market could intensify competition between Asian and European buyers, particularly as both regions seek to secure enough supply to meet energy demand amid ongoing geopolitical uncertainties.
Juliet Ezeh is the founder and chief reporter at Westbridge Reporters with over 7 years of experience in journalism. She covers crime, industry, policy, and social developments, delivering timely and accurate reporting.