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US LNG Exports Rise Only Slightly

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US shipments of liquefied natural gas (LNG) rose only slightly in August, showing they continue to be constrained by a June outage at the second largest US exporter, recent data from Refinitiv Eikon showed.

Freeport LNG’s shutdown following an explosion has cut monthly US exports by about four cargoes, or 1.6 million tons. In late August the company delayed a restart at the Quintana, Texas plant – originally planned for October – aiming to reach 85 percent of its full 15 million tons per annum capacity in late November, with full operations scheduled for March.

The export limits have contributed to sky-high global prices amid strong demand and a temporary halt of Russian gas shipments to Germany that began August 31. LNG at the Dutch trading hub sold in the week starting August 29  at around $77 per million British thermal units (mmBtu), more than double the price from February.

The US exported 6.25 million tons of LNG in August, slightly above the 6.16 million tons of July but still below the pre-explosion levels, according to preliminary tanker tracking data on Eikon.

Exports to Europe, Latin America and the Caribbean declined in August, the data showed. Sales to Asia inched higher amid stronger demand in South Korea and Japan, which pushed Asian spot LNG prices to a record in the week beginning August 22.

In Europe, gas markets recently took “a sigh of relief” after aggressive purchasing of LNG cargoes and piped gas, which replenished stocks faster than the European Union’s targets, researcher Rystad Energy said in a note to clients: “Europe is in full bunkering mode and taking no chances with Russian supplies.”

But the US, where natural gas prices at the Henry Hub have continued rising to touch nearly $10 per mmBtu in intraday trading, has been unable to keep ramping up LNG exports since the Freeport incident. US prices settled at $9.127 per mmBtu.

Fewer shipments from the US, which in the first half of 2022 became the world’s largest LNG exporter, have hit the Panama Canal, where LNG traffic fell 30 percent in the nine months through July, the waterway’s authority said in August.

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