LNG imports to the Western and Eastern Mediterranean regions will experience a sharp year-on-year decline in 2024, according to S&P Global Commodity Insights data, with increasing renewable energy supplies and strong pipeline flows dampening appetite for waterborne LNG cargoes.
Total LNG imports to the Western Mediterranean – Spain, Portugal, Southern France – and the Eastern Mediterranean – Turkey, Greece and Croatia – reached 46.73 million mt, or 761 cargoes, for 2024 according to the data. This is the lowest imports to the Mediterranean region since 45.41 million mt, or 764 cargoes, in 2021.
This figure also compares with 56.08 million mt, or 909 cargoes, in 2023 and 61.36 million mt, or 1,024 cargoes, in 2022.
Of the total LNG imported by Western and Eastern countries in 2024 so far, the largest volume came from the US at 17.23 million mt, followed by 10.84 million mt from Algeria. Specifically, 5.94 million mt came from Russia, 5.91 million mt from Qatar, and 3.96 million mt from Nigeria.
The decline in imports was spearheaded by Spain, which saw a 25% year-on-year decline to 13.84 million mt in 2024. The country saw growth in wind and solar power generation, which helped reduce demand for gas-fired power plants. Cooler temperatures in parts of the winter also depressed residential and commercial demand.
Additionally, Spain seeks to leverage underground storage and healthy pipeline flows from France to meet rapid increases in domestic demand and counter strong LNG withdrawals from premium NBP and PSV markets during the final quarter of 2024.
Net imports from France via the Pirineos interconnection point amounted to 223 million cubic meters in Oct. 1-Jan. 7, while Spain is a net exporter of gas to France with orders of 452 million cubic meters compared to the same period last year.
Following a similar trend in Europe amid tight LNG markets, net withdrawals from Spanish underground storage between the start of the heating season and January 7 averaged 72.89 GWh/day, compared with 38.7 GWh/day and a net injection rate of 13 .5 GWh/day. during the same period one and two years earlier respectively, according to Gas Infrastructure Europe data.
This led to natural gas storage being 79.9% full with 28.63 TWh stored on January 7, which represents a 20.3% decrease from the 35.9 TWh seen at the start of the heating season on October 1, according to the latest GIE data. In comparison, storage is down 11.12% in 2023 and up 4% in 2022 over the same period.
Countries in the Mediterranean saw a surge in spot purchases towards the end of the first half of winter in December, to secure supplies ahead of the expiry of the Russia-Ukraine transit agreement. This leads to higher spot prices as Med participants seek to attract cargo volumes from other competitive demand centers.
Platts, part of Commodity Insights, assessed Mediterranean LNG prices for February at $13.485/MMBtu on January 8, stronger than the $9.286/MMBtu seen at the same time last year, and at a discount of 23 cents/MMBtu to the Dutch TTF of $13.715/ MMBtu.
Intermediate LNG prices are at a 24.4 cent/MMBtu discount to PVB — Spanish hub gas prices were last assessed at $13.729/MMBtu.
Platts valued the Eastern Mediterranean Marker for August at $13,645/MMBtu on January 8, a premium of 13 cents/MMBtu compared to the Northwest European LNG marker.
Eastern Mediterranean LNG prices are at a discount of 7 cents/MMBtu to TTF, and a discount of 52.8 cents/MMBtu to Italian gas hub PSV.
The volume of LNG shipped to Italy in 2024 reached about 10.69 million mt, down 11.2% from the 12.03 million mt recorded in 2023, according to Commodity Insights data.
However, with total import capacity expected to reach 28 Bcm/year in 2025 along with the start-up of the Ravenna FSRU in early April, Italian transmission system operator Snam is confident that LNG imports can meet a third of the country’s annual gas needs for the foreseeable future. many years.
Source: Platts
