SINGAPORE: Malaysia’s exports of liquefied natural gas (LNG) are set to drop to their lowest since mid-2018 as producers globally are pressured to cut production amid record low spot prices of the super-chilled fuel, trade and shipping sources said.
Lockdowns to slow the coronavirus pandemic are pummelling gas demand worldwide, pushing Asia’s spot prices to record lows and forcing some suppliers to start cutting output.
Malaysia, the world’s fourth largest LNG exporter, is set to ship out about 1.5 million to 1.64 million tonnes of the fuel in May, the lowest since June-July of 2018, shiptracking data from Refinitiv and Kpler shows.
About 1.92 million tonnes was exported in April, data from Refinitiv showed.
Malaysia’s main LNG exporter, state-owned Petronas, has cut its shipments of spot cargoes, said three industry sources who sought anonymity because they were not authorised to speak to media.
The oil and gas producer is now exporting about one to two spot cargoes, down from about five to 10 during the summer months in previous years, one of the sources said, adding that the reduction was due to a production cut.
The company will still meet its term commitments for now, two sources said.
It posted a plunge of 68% in first-quarter profit last week and said it would cut capital expenditure and operating expenses as it braces for a big hit to full-year performance from the virus pandemic. – Reuters