* India, Kuwait seek supplies for March, April
* Prices resume downward slide after rally
* CPC five-year tender moves near 11 percent oil slope
By Oleg Vukmanovic
MILAN Feb 12 (Reuters) - Asian spot prices for liquefied natural gas (LNG) succumbed to chronically weak demand and downcast oil markets, following a short-lived rally last week, while both India and Kuwait sought cargoes for March shipment.
LNG prices for March delivery in Asia fell back to $5.50 per million British thermal units (mmBtu), down 25 cents from the previous week, when prices shot up after Russia’s Sakhalin-2 export plant had to cut output.
But dim demand outlooks and a mounting supply overhang as giant export plants in Australia and the United States go live prompted a resumption of a months-long price slide.
Traders said there remained limited end-user demand, with plenty of surplus supply to fill gaps left by Sakhalin.
April spot LNG prices are trading lower at $4.90 per mmBtu, anticipating Sakhalin-2’s return to normal operations as well as first exports from Cheniere Energy’s Sabine Pass terminal on the Gulf Coast.
Gail India is seeking two cargoes for March delivery and one for April, trade sources said.
Some seemed sceptical over the true extent of demand, noting a tendency among Indian buyers to cancel tenders at the last moment.
Kuwait Petroleum Corporation is also seeking a cargo for delivery in the second half of March, two sources said.
It remained unclear if Taiwan’s CPC had awarded its tender to buy 60 cargoes over five years, with various companies mentioned as potential winners.
CPC, which invited 10 firms to bid in the tender, stipulated a price range of between 11-12 percent of a barrel of Brent crude oil in its initial guidance to traders, a source said.
However, in the second round of the tender, it asked for an oil-indexation level of 11 percent, giving traders free rein to pick whichever fixed cash fee on top they felt was competitive, he said.
The fixed fee, known as a constant, is expressed in dollars/mmBtu.
Chevron, BG< BG.L>, Shell, Petronas , Engie, Gazprom, and BP were among those invited to the tender.
The price CPC fetches in this tender will serve as a benchmark for similar transactions, traders said.
Elsewhere in Asia, Pakistan signed a 15-year agreement to import up to 3.75 million tonnes of LNG a year from Qatar, representing a major step in filling its energy shortfall.
A Pakistan government statement said that Qatari LNG will be priced at 13.37 percent of Brent crude oil.
In the Middle East, Egypt is looking to launch a major purchase tender for supplies in 2017 and 2018 in the second half of this year, probably this summer, traders said. (Additional reporting by Sarah McFarlane; Editing by David Goodman)