LNG Tankers Divert to Europe as Russia Halts Gas Supplies to Austria

LNG Tankers Divert to Europe After Russian Supply Halt

At least five liquefied natural gas (LNG) cargoes have changed course from Asia to Europe. This shift is due to rising gas prices in Europe after Russia’s Gazprom stopped supplies to Austria’s OMV.

On Saturday, Gazprom halted its gas exports to OMV following a compensation threat linked to a previous arbitration victory by OMV. Gazprom announced this supply halt on Friday, causing European gas prices to spike. The Dutch TTF hub saw prices rise, making it more profitable for traders to route gas to Europe.

Laura Page from Kpler noted that concerns over Russian gas supplies and an approaching cold spell led to this diversion. The price for the front-month contract at the Dutch TTF hub reached 46.00 euros per megawatt hour on Monday, the highest since November 23, 2023. Meanwhile, Asia’s Japan Korea Marker benchmark was priced around $14 per mmBtu.

Several tankers have diverted their routes:

• The Vivert City LNG tanker, originally bound for Bangladesh from Equatorial Guinea, is now heading to the South Hook terminal in Britain.
• The Gaslog Windsor, carrying U.S. LNG from Sabine Pass to China, rerouted to the Isle of Grain terminal in Britain.
• The BW Lesmes, loaded with Nigerian gas, also changed direction to the Isle of Grain.
• The Diamond Gas Crystal, initially set for South Korea, has switched to the Dutch Gate terminal.
• The Flex Vigilant, coming from China, is now on route to Europe awaiting further instructions.

Analysts noted that UK terminals were less busy, providing more opportunities for unloading cargoes. Russian gas exports via Ukraine remained stable, according to Gazprom. However, Ukraine announced it would not renew its gas transit deal with Russia after the current agreement ends this year.