Asia LNG: Weekly Brief May 22, 2025

Week: May 15–21, 2025. North East Asia spot and JKM prices rebound modestly. Japan’s imports recover as storage lags. Cooling demand emerges amid rising temps.

Northeast Asia’s LNG market moves into late May amid early signs of seasonal demand shifts and cautious supply-side positioning. Spot prices posted a modest gain, and front-month JKM swaps rebounded more sharply, though both remain within a broadly bearish structure.

In Japan, LNG imports have begun to recover following a post-winter lull, while gas-for-power storage remains below 2024 levels. Weather forecasts reinforce this shift, with sustained above-normal temperatures and a rise in Cooling Degree Days expected to support incremental power-sector consumption.

South Korea shows more volatility, with LNG imports surging sharply above historical norms after a steep drop, highlighting reactive procurement behavior. Although heating demand persists through late May, forecasts point to its eventual decline as temperatures rise.

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North East Asia LNG Spot Price Rises Slightly Amid Soft Fundamentals

The Northeast Asia spot LNG price increased to $11.80/MMBtu, up from $11.50/MMBtu the previous week. This moderate rebound follows a period of sustained weakness and likely reflects a combination of market recalibration and cautious optimism tied to macroeconomic developments, including recent tariff easing between the U.S. and China.

Despite the uptick, the price remains near the lower end of its 12-month range, underscoring persistent bearish fundamentals tied to soft demand and ample supply. Without a clear structural shift in buying activity or weather-driven demand, the spot market continues to trade within a broadly downward channel.

Front-Month JKM Swap Rebounds Amid Market Repricing

The JKM front-month swap climbed to $12.48/MMBtu this week, up from $11.46/MMBtu previously. This marks a significant weekly gain and reflects a broader repricing trend following the recent uptick in spot values.

The rebound is likely tied to improved sentiment after the partial easing of U.S.-China tariffs, which has tempered geopolitical risk perceptions and lent support to near-term demand expectations.

Japan’s LNG Imports Rebound as Seasonal Demand Begins to Build

Japan’s 14-day moving average LNG imports rose to 242.92 Mcm/d, up from 190.20 Mcm/d the previous week. This recovery follows the post-winter trough and brings current intake closer to the lower bound of the historical 2020–2024 range.

The increase likely reflects the onset of early cooling demand, supported by rising temperatures and a seasonal shift in consumption patterns. The trajectory aligns with historical mid-year restocking behavior, suggesting utilities are cautiously re-entering the market ahead of stronger summer loads.

Japan’s Gas Storage Edges Up but Remains Below 2024 Levels