LNG imports into Europe remained at multiyear highs in February (~10 mt) at the expense of imports into Asia, which declined by 16% from 2021 levels. A combination of a mild winter, high prices stunting demand, a draw down LNG storage and a focus on coal imports has seen LNG imports into Japan, South Korea & India dropping to near 5 year lows in February. Chinese imports (the key driver of stronger Asian imports last year) have also declined from 2021 levels.
The traditional flexibilities in the European gas market have been exhausted (coal-gas switching, storage levels). The stage is set for Europe to move from being a global sink for LNG to a much more dynamic competitor, with JKM-TTF spreads the indicator to watch.