Asian liquefied natural gas (LNG) prices edged up this week as the global market drew some support from demand in Mexico, after its state-run power company purchased six cargoes.
The price of Asian spot cargoes for January delivery edged up to US$7.30 per million British thermal units (mmBtu), from around $7.20/mmBtu last week.
Cargoes for February delivery were lower at around $7.10/mmBtu, with supply from new projects in Australia and the United States expected to pick up in the new year.
Mexico's CFE secured five LNG cargoes from Citi and one from Gazprom Marketing & Trading for delivery in the first half of 2016, traders said.
Two sources said there had been some interest for cargoes into northwest Europe.
"I'm not sure if it's demand or if it's because it's a market that can always take an extra cargo," said a broker.
European utilities are expected to take centre stage when a wave of LNG hits Europe starting next year, as long unprofitable import capacity soars in value and bolsters their clout in the global trade.
Northwest Europe's excess import capacity, with its extensive pipeline networks and highly liquid trading hubs, enables the region to absorb additional gas supply better than elsewhere.
However, the start of Europe's winter has been milder than seasonal norms.
"People are taking a bit of a bet on prices because if there's a cold snap you could make a bit of money on it," the broker said.
Turkey, a seasonal market with much stronger LNG demand during winter, also showed some demand this week, the broker added.
Turkey is expected to step up efforts to diversify its supplies of LNG with the addition of new import terminals to lessen its reliance on gas from Russia, with floating terminals (FSRUs) likely to be the speediest solution.
Russia is Turkey's top gas supplier but growing tensions between them over the Syrian conflict is souring trade relations and threatening to reshape commodity flows.
"There's FSRU opportunities, Turkey is a prime candidate for it … pipelines are maxed, everything is maxed during the winter," said a trader.
Turkey's President Tayyip Erdogan and Prime Minister Ahmet Davutoglu travelled to Qatar earlier this month in an effort to secure long-term LNG supplies.
"I think something will get done, I think the timing is right for Qatar as well. Qatar has always been a big swing supplier for them in the winter," the trader said.
Top buyers Korea and Japan remained relatively quiet, traders said, although there was some interest in the market from China.
