Even as the world swelters in a heat wave, prospects for a harsh winter in Europe are already driving up global rates for LNG transport. That puts Thursday's second-quarter financials from Cheniere Energy squarely in focus for investors, despite analyst forecasts for profit and sales declines. LNG stock moved down early Wednesday.
The U.S. Energy Information Administration reported last week average front-month futures prices for LNG cargoes in East Asia were $11.13 per million British thermal units, down 72% compared to 2022.
LNG Stock: Big Prices For Gas Tankers
LNG and U.S. natural gas prices have dropped considerably compared to last year. But traders appear set to spend big to ship liquefied natural gas ahead of the winter heating fuel demand season, Bloomberg reported Friday.
Daily charter rates for LNG carrier ships surged to $206,750 for October and $284,750 for November, more than doubling from current levels, according to data from Spark Commodities. If those rates hold, natural gas prices could jump, mirroring 2022 when the global LNG market rushed to replace Russian gas supplies.
BP Earnings Fall 65% With Oil Major's Surplus Cash Turning Negative
Warren Buffett also continues to bet on energy and LNG. On July 10, the billionaire investor-led Berkshire Hathaway agreed to buy Dominion Energy's share of the Maryland-based Cove Point LNG export plant in a $3.3 billion deal.
Shares of LNG stock edged lower in early trade Wednesday. On Tuesday, Cheniere Energy stock closed at 160.25.
Among LNG transport and processing stocks, Golar LNG fell 0.8% early and Flex LNG lost 1%. Meanwhile, LNG stock New Fortress Energy shed nearly 2%.
U.S. Gas Deliveries To Export Terminals Sets Record
Natural gas deliveries to LNG export facilities in the U.S. averaged 12.8 billion cubic feet per day (Bcf/d) in the first six months of 2023, a 4% increase compared to last year, according to a recent report by the Energy Information Administration (EIA).
Meanwhile, gas deliveries set a monthly record in April at 14.0 Bcf/d, supported by high international demand for U.S. LNG exports, particularly in Europe, the EIA reported.
U.S. natural gas futures hovered around $2.50 per million British thermal units early Wednesday. Prices are down around 60% from the same time last year when futures spiked to 14-year highs as Russia's invasion of Ukraine sparked fears of an energy crisis in Europe.
Meanwhile, natural gas futures for delivery at the Title Transfer Facility (TTF) in the Netherlands averaged $9.67 per million British thermal units, an 82% drop vs. 2022.
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