'Natural Gas Crisis' Korea-Japan LNG International Prices Surge 42% in One Day

[Image source=AFP Yonhap News]

[Asia Economy Reporter Park Byung-hee] Amid a global "energy crisis," spot prices for liquefied natural gas (LNG) in Asia, including South Korea and Japan, surged more than 40% in a single day.

According to Reuters on the 6th (local time), the Japan-Korea Marker (JKM), a Northeast Asian LNG price indicator, rose by $16.65 (42.0%) to $56.326 per million BTU (British Thermal Units) for November shipments compared to the previous day. This daily increase is the largest ever recorded.

The price for December shipments also surpassed $57.

Kenneth Poo, head of Asia LNG price aggregation at Standard & Poor's (S&P) Global Platts, an energy and commodities information provider that compiles JKM data, explained, "Soaring European gas prices are exerting upward pressure on Asia-Pacific LNG prices."

On the same day, wholesale gas prices across Europe, including the UK and the Netherlands, hit record highs before stabilizing somewhat following Russia's announcement of increased supply.

UK wholesale gas prices briefly surged to 407 pence per unit, nearly seven times the level at the start of the year, before falling to 257 pence after Russian President Vladimir Putin stated that gas supply to Europe would be maintained.

At the Netherlands TTF exchange, the benchmark for European natural gas prices, futures prices soared 40% early in the session to 162 euros per megawatt-hour (MWh) but plunged after President Putin's remarks, closing at 104.9 euros per MWh.

President Putin instructed Russia's state-owned gas company Gazprom not to reduce gas supplies to Europe via Ukraine and to comply with existing contractual obligations.

Meanwhile, due to the sharp rise in natural gas prices, the Ministry of Trade, Industry and Energy has expressed the need to raise city gas rates within the year. However, Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki stated at a National Assembly audit on the 5th that there will be no gas price increase in November.

This content was produced with the assistance of AI translation services.