--DES Northeast Asia

Electricity supply in Japan is turning somewhat tight. While temperatures are high, many areas in the Tohoku and Chugoku regions are cloudy, causing a decline in solar power generation. Furthermore, power plant issues appear to be occurring, such as run cuts by Tohoku EPC at the No1 and No2 units with a respective capacity of 1,000MW at its Haramachi coal-fired power station due to equipment malfunctions. As a result, cross-regional power transfers were implemented in both eastern and western Japan on May 21. Tohoku EPC was said to have procured one cargo for Aug 17-23 delivery through a DES-based buy tender closed on May 21. The awarded price was heard at a discount to DES Northeast Asia spot quotes for August. However, LNG inventories for power generation still stand at 2 mil mt (see "Japan's Domestic Natural Gas Market"). JERA explained, "Although inventories are slightly below plan, they are not declining significantly." Starting in June, the company plans to build up inventories in preparation for the summer demand season, and import volumes are also expected to increase compared to April and May, in line with the Annual Delivery Plan (ADP). In addition, regarding concerns about a decline in industrial gas demand, one of Japan's major city gas companies stated, "It is true that the procurement of petroleum products (used as raw materials) is stalling in the manufacturing sector, but we have not heard of any production adjustments being made as a result." The company added, "Gas consumption has not changed significantly for any company."

--FOB Middle East, DES South Asia and the Middle East

Bangladesh's state-run Rupantarita Prakritik Gas Co Ltd (RPGCL) was initially believed to have purchased two cargoes through a tender closed on May 19, but eventually decided not to procure all three cargoes, according to a Japanese analyst. "Although RPGCL was reported to have purchased a Jun 15-16 delivery cargo at $19.73 and a Jun 21-22 delivery cargo at $19.67, the offers may have been too high," a Japanese analyst said. RPGCL subsequently issued a new DES-based buy tender that closing on May 22 for a total of four cargoes for Jun 15-16, Jun 21-22, Jun 24-25, and Jun 27-28 delivery. Additionally, India's state-owned Bharat Petroleum Co Ltd (BPCL) reportedly procured one cargo for first-half June delivery at 19.20-19.30 through a buy tender closed on May 20. Furthermore, BPCL also procured one of the four partial cargoes for May 21-Jun 30 delivery that were also part of the tender in the high $18s.

--FOB Atlantic, DES Europe and South America

Argentina's state-run ENARSA changed the closing date for its buy tender for July delivery to May 26 from May 20. The tender seeks a total of 10 cargoes for delivery to the 6.1 mil mt/year Escobar terminal on Jul 2, 5, 8, 12, 15, 18, 21, 25, 28, and 31.