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Energy

CORRECTED-GLOBAL LNG-Asian prices rise despite record high U.S. exports

(Corrects headline and first paragraph to say prices rose instead of fell, adds January price in paragraph 3)

RIO DE JANEIRO, Nov 13 (Reuters) - Asian spot prices for liquefied natural gas (LNG) edged higher this week amid production issues in Australia and Malaysia though weak Chinese demand and record high U.S. exports capped price gains.

The average LNG price for December delivery into Northeast Asia LNG-AS was estimated at around $6.80-$6.90 per million British thermal units (mmBtu), up 10 to 20 cents from the previous week.

The price for cargoes delivered in January are estimated to be about $6.50 per mmBtu, sources said.

Asian LNG prices have more than tripled since July’s low of $2.00, and bullish sentiment deepened in September and October due to a wave of supply disruptions.

Loadings of LNG cargoes had been delayed in the past weeks from Malaysia’s Bintulu plant, operated by Petronas, but the issues proved to be temporary and shipments are expected to be normalized soon, sources said.

LNG has been facing both supply and demand disruptions due to the COVID-19 crisis.

Possible LNG supply shortages that could sustain prices remain in Australia, where Chevron Corp’s Gorgon LNG plant has been facing production issues, and in the U.S.

The election of Joe Biden in the U.S. presidential run last weekend raised expectations of a possible contraction in shale gas incentives. An eventual slowdown in production recovery in the United States as demands heats up could restrict supply and pressure prices, traders said.

U.S. natural gas futures edged up on Friday as exports continued to hit fresh record highs and on forecasts for cooler weather and more heating demand in coming weeks.

Much of that U.S. supply will be directed towards Asian markets.

“Ongoing congestion in the Panama Canal is resulting in some U.S. exports being sent the long way — via the Suez Canal and Cape of Good Hope - to Northeast Asian markets,” said analysts at Energy Aspects. (Reporting by Sabrina Valle; Editing by Nina Chestney)

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