Liquefied Gas Shipments To Asia Stymied By Panama Canal ‘Traffic Jam’

Demand for liquefied natural gas is high in China, Japan and Korea during a particularly cold winter in the region.

By Alexandra Hart & Caroline CovingtonJanuary 25, 2021 5:05 pm,

A colder winter than usual has been somewhat of a boon to the Texas liquefied natural gas business.

Energy insider, Matt Smith of ClipperData, told Texas Standard that extra cold temperatures in northeast Asia have led to increased demand for “spot” shipments of liquefied natural gas, or LNG, from producers along the Gulf Coast. The demand is so high that LNG is selling for the equivalent of about $250 a barrel.

“It’s caused a spike in electricity demand in Korea, in China, in Japan,” Smith said. “This is having this ripple effect all the way back to the U.S. Gulf … because Asia is the leading destination for U.S. LNG.

But there have been challenges to shipping it. Smith says there have been bottlenecks in the Panama Canal.

What you’ll hear in this segment:

– Who are the top LNG exporters

– What has contributed to the “traffic jam” in the Panama Canal

–  Whether the increasing demand for American LNG will last

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