Purveyors of fear
Let us face reality! Pakistan being less than 2% of the global LNG trade, we do not move the market
First, it was said that the Government of Pakistan bought LNG at extremely high prices for December 2020, raising fears that LNG consumers were in for a substantial price hike; and somehow there was wrongdoing on the part of the government as if Pakistan decided international market prices. The truth is that the average Delivered Ex-ship (DES) price of December 2020 was $6.34/MMBtu which was the lowest price of LNG of any December with December 2017 being at $7.5/MMBtu. Then the fear mongering went on that there would be a massive gas shortage in December 2020. As it turned out there was no gas curtailment in December 2020 except for CNG in the last ten days as per Cabinet’s approved gas allocation priority in vogue for many years. There were indeed low-pressure issues for residential consumers at tail ends in the last ten days, but that is a function of the ill -
Pakistan Receives One of The Costliest Bids Ever for February’s LNG Procurement
Pakistan received bids from five liquefied natural gas (LNG) companies for two cargoes in February 2021, at the highest price as yet.
Pakistan LNG Limited (PLL) received these all-time highest bids up to 32.48 percent of Brent. The lowest bids for the delivery windows of February 2021 were nearly at 21 percent to 23 percent of Brent, as received by the PLL.
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However, as a result of this delay in the process by the government, Pakistan has to purchase the costliest liquefied natural gas (LNG) in February 2021, at 32.48 percent of Brent, with a 31-day gap between tender opening and advertisement.