Asian LNG MOC activity for July JKM hits new peak ahead of summer demand surge

The Platts Market on Close assessment process for Asia's LNG physical and derivatives markets hit a new record high during the July JKM pricing period, as market participants ramped up activity ahead of peak summer demand in Northeast Asia, data from S&P Global Energy showed.

A total of 607 bids, offers, and trades were reported during the July cycle -- up 38.6% month over month and 150.8% year over year -- surpassing the previous high of 438 in the June cycle. The robust activity reflected increased interest in securing physical volumes and managing exposure amid tightening summer fundamentals.

Daily peaks of 39 bids, offers and trades were recorded on June 3 and 4, followed by 38 on June 5 and 37 on June 6.

The 607 data points included 334 bids, 255 offers, and 18 trades for June, July and August deliveries, involving 22 entities. Activity remained concentrated on deliveries into the Japan-Korea-Taiwan-China region, with just one bid targeting Japan specifically and three aimed at India.

All 18 trades recorded were for July delivery into the JKTC region, totalling around 1.17 million mt of LNG. Of these, 11 trades resulted from bids being hit, with Vitol and BP on the buy side. Sellers included BP, Chevron, Jera GM, PetroChina, QatarEnergy Trading, RWE, TotalEnergies, and Woodside.

The remaining seven trades came from lifted offers, all purchased by Vitol, with ADNOC Trading, Marubeni, QatarEnergy Trading, and Tokyo Gas Energy Trading on the sell side.

Fixed-price deals accounted for two-thirds of the activity, reflecting market interest in locking in absolute values amid expectations of rising summer prices. The remaining six trades were index-linked, split evenly between the JKM Balance-month next-day contract and the JKM August full-month average.

Of the 589 bids and offers, 61.8% were on a floating price basis. Among these, 360 were linked to the JKM full-month average or JKM Balance-month contracts, with only four tied to the Dutch TTF index.

The derivatives Platts MOC saw a record-high number of 2,537 bids, offers, and trades reported by 27 entities. This reflects a month-over-month increase of 30.37% and a year-over-year increase of 54.98%.

Notably, activity increased in both JKM time spreads and JKM/WIM spreads, with the JKM August/September 2025 spread recording 100 bids and offers, and the September/October 2025 spread seeing 57. In comparison, the JKM/WIM August and September spreads saw 18 and 14 bids and offers, respectively.

JKM edges higher on geopolitical premium, summer restocking

The Platts JKM for July, the benchmark price for cargoes delivered into the Northeast Asian region, rose by 8.75% month over month to $12.504/MMBtu, supported by heightened geopolitical risk and increased buying interest from Chinese and South Korean buyers for prompt and summer deliveries, respectively.

On June 13, Israel launched a series of airstrikes targeting Iran's nuclear infrastructure, prompting a swift retaliation from Iran in the form of drone attacks. The escalation reignited concerns within the LNG market over potential supply disruptions through the Strait of Hormuz, a critical chokepoint for LNG exports from Qatar, Oman, and the UAE en route to Northeast Asia.

While there was no immediate impact on global physical gas flows, and the risk of a full closure of the Strait remains low, the heightened tension injected a risk premium into the market.

According to S&P Global Commodities at Sea data June 16, around 26 laden LNG carriers have recently transited or are currently transiting the Strait of Hormuz.

Meanwhile, buyers in South Korea and China were active in the spot market, moving to secure cargoes ahead of anticipated summer demand. South Korea's KOGAS was heard to have purchased two to three cargoes for July and August deliveries, and was still seeking additional volumes, according to market sources.

Chinese buyers were also seen stepping up procurement despite continued weak downstream demand, with up to three spot cargoes purchased since late May—largely as a preemptive move to bolster inventories ahead of peak summer consumption, sources added.

As Northeast Asia moves into the peak summer period, market participants are closely watching weather conditions and the extent of competition between the Pacific and Atlantic basins—factors likely to shape Asian LNG prices and regional premiums in the coming weeks.

The East-West arbitrage for US-sourced cargoes transiting via the Cape of Good Hope remained largely shut for deliveries into Northeast Asia throughout the July JKM pricing period, with the Platts-assessed arbitrage averaging minus 44 cents/MMBtu. Reflecting the unfavorable economics, just 12.21% of offers in the physical MOC specified a US base load port.