The Platts JKM for December delivery plunged 82.5 cents over the Asian trading week, closing at $13.50/MMBtu Friday as offers came under further pressure due to weak demand.
Significant falls in the crude oil markets in recent weeks dragged long- term contract prices for December and January below $15/MMBtu, resulting in sellers cutting spot offers in a bid to place volumes from Indonesia, Malaysia, the Middle East and the Atlantic Basin.
As many as three spot cargoes were heard to be available for November, resulting in a build in downward pressure on the prompt.
This spilled over into December and even January, with as many as nine cargoes for each month heard to be seeking homes.
Up to three traders who were floating vessels for storage were heard to have foregone the option to extend the charters, indicating that volumes would be sold ahead of January.
Applying further pressure was news of a sell tender from Australia's North West Shelf LNG. The facility was widely reported to be offering an unspecified number of cargoes on either a FOB or DES basis.
Loading windows over the second half of November and mid-December were considered wide, suggesting more than two cargoes may be made available.
Several sources said portfolio sellers looking to optimize positions in Asia could show some interest in the tender, particularly those with shipping in hand.
Trading was limited in northeast Asia following a slew of deals for first-half January delivery at around $15/MMBtu in recent weeks, with only buyers in China now showing an interest for spot cargoes in December.
CNOOC will need at least one cargo a month for delivery to its Tianjin terminal in the north of the country until the end of the first quarter, according to the state-owned buyer, while Petrochina was also understood to be on the hunt for winter cargoes after purchasing a reported three for November.
However, both were widely considered to be in no rush to transact as building pressure on the prompt was likely to drive offers lower, sources said.
South Korea Midland Power Company, or Komipo, had also launched a tender for a partial cargo delivered over second-half December on a DES basis.
While some bidding interest was heard from three or four potential suppliers, validity was said to have been extended beyond the initial October 20 expiration.
In India, importer GSPC was heard to have awarded its tender for one DES cargo arriving in early December at $12.80-12.90/MMBtu.
Several sellers who had entered the bidding process with offers of low $13/MMBtu said that similar levels were also on offer for November, crunching the intermonth contango.
The DES west India assessment ended the week $1.00/MMBtu lower at $12.80/MMBtu as a result.
At least one more western Indian importer was heard to be seeking a December delivery, but was showing low bids, sources in the region said.
The intermonth contango into January narrowed significantly, with offers for the first half of the month dropping from $15/MMBtu at the beginning of the week to below $14/MMBtu in some cases.
As in December, there was limited interest to transact for the period outside of China, with buyers in Japan saying they had largely covered their requirements up until February.
In the LNG derivatives market, February JKM swaps transacted at $14.30/MMBtu mid-week, with offers for January, February and March clustering around $14.00/MMBtu as the Q1 contango narrowed.
