HomeNewsU.S. LNG exports fall in May on lower output and changing demand trends

U.S. LNG exports fall in May on lower output and changing demand trends

6/2/2023

(Reuters) - U.S. exports of liquefied natural gas (LNG) fell in May to 7.66 million tons from a record 8.01 million tons in April as plant maintenance curbed some output and weaker prices in Europe cut flows to the region, shipping data showed.

U.S. LNG exporters reduced cargoes to Europe last month while more LNG was delivered to Asia and Latin America, partially offsetting the European weakness, according to Refinitiv Eikon preliminary vessel tracking data.

Asia LNG prices for July delivery have rebounded from earlier declines, making U.S. LNG more attractive for traders and oil majors with access to spot cargoes, according to consulting firm Rystad Energy.

But in Europe, the primary market for U.S. LNG, front-month prices at the Dutch Title Transfer Facility have slid, Rystad noted, creating an opportunity for buyers from other regions to purchase spot U.S. LNG cargoes.

U.S. LNG exports to Europe fell from 71% of total exports in April to 60.5% in May, while exports to Asia rose to 14% of total shipments last month from 12% in April. Latin American imports of U.S. LNG grew to 11% in May, from 6% in April, the data showed.

The increase in exports to Latin America comes as there is greater seasonal demand for natural gas for power generation and air conditioning, and in some parts of Latin America for heating as countries enter the winter period.

The decline in total U.S. LNG output came as planned maintenance affected some large facilities, according to Rystad Energy.

Scheduled maintenance at Sempra's Cameron LNG train 2 at the end of April affected some 300,000 tons of supply, with the plant restarting on May 22. Maintenance at Cheniere Energy's Corpus Christi LNG facility was expected to be completed on May 18, but its utilization of feed gas remained at 1.3 billion cubic feet per day (bcfd) as of May 20, compared to typical levels of some 2 bcfd, Rystad noted.

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