World News
LNG Market Has Reached a "Scale and Size that is Interesting"
Commodities giant Glencore Xstrata PLC has created a new liquefied natural gas (LNG) team to work in the physical LNG trading arena, the Wall Street Journal reports.
The company hired four former Morgan Stanley traders to run the new operation, which is based in London and Singapore.
Alex Beard, head of the company's oil operations, said last month that it would take advantage of arbitrage opportunities and blend products to achieve higher premiums.
"LNG, I think fits more naturally, more properly within a physical trading house than it does within a bank and that's why we feel that the LNG market has now got to a scale and the size that is interesting for us to trade physically," he said.
"That's why we have an LNG team starting in September, looking for those physical LNG trading opportunities."
Beard said LNG is more like oil than natural gas from a trading perspective since it can be shipped globally, creating arbitrage opportunities that are not possible with piped gas.
Glencore Xstrata and the Vitol group have become interested in LNG trading as new production operations bring more of the fuel to the market, according to reports earlier this year.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 502.00 | 4.50 | 617.00 | 5.50 |
| Rotterdam | 457.50 | 2.50 | 623.50 | 6.50 |
| Houston | 469.00 | 3.50 | 623.00 | 2.00 |
| Fujairah | 494.50 | 6.50 | 715.50 | 5.50 |
| Global 20 Ports Average | 526.00 | 3.00 | 712.50 | 11.50 |
| Global 4 Ports Average | 481.00 | 4.00 | 645.00 | 4.50 |
| Global Average Bunker Price | 569.00 | 2.00 | 750.00 | 5.50 |
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