JAKARTA - The price of liquefied natural gas or LNG in Asia has jumped to its highest level since the end of March. The increase occurred after the conflict heated up again around the Strait of Hormuz and disrupted shipments from the Persian Gulf.
Anadolu Agency quoted Thursday, July 16, saying the Japan-Korea Marker or JKM, the reference price for spot LNG for shipments to Northeast Asia, rose 19.66 percent on Wednesday to 19.93 US dollars per million British thermal units.
British thermal unit or Btu is a unit to measure energy content. Spot LNG is cargo traded for delivery in the near future.
In the past month, the price of JKM has risen 25.03 percent. Compared to the same period last year, the price jumped 60.66 percent.
The latest conflict around the Strait of Hormuz has limited LNG shipments from the Persian Gulf. The area accounts for about 20 percent of the world's LNG supply.
The disruption mainly affects Qatar's LNG exports. All cargo from the country must pass through the Strait of Hormuz before heading to international markets.
A number of buyers in Asia then sought alternative supplies. Pakistan and Bangladesh are among the countries looking for other cargoes due to disruptions in shipments from Qatar.
Competition for available spot LNG cargoes has also increased and pushed prices higher.
The Strait of Hormuz connects the Persian Gulf with the Gulf of Oman and the Arabian Sea. The route is one of the important routes in the world's oil and LNG trade.
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