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By Emily Chow and Muyu Xu
KUALA LUMPUR, June 27 (Reuters) - Asian buyers have rushed to lock in long-term liquefied natural gas (LNG) deals in the past months after prices eased, for fear of sudden price spikes as the global market remains tense after last year's crisis, industry executives said at a conference.
Spot LNG prices in Asia last traded at $12 per million British thermal units (mmBtu) on Friday after touching two-year lows due to high inventories and a mild winter at the start of the year. Just a year ago, prices hit record of $70 per mmBtu after Russia cut gas supplies to Europe and sparked a global scramble for LNG.
"The LNG market is still in tension. To be clear, there is not much supply," said Patrick Pouyanné, chairman and chief executive of TotalEnergies.
"So I hope the weather in Europe will be warmer this winter, otherwise there is no other way to take more energy."
For the full year of 2023, Asia is seen consuming 260 million tonnes of LNG, said Vitol Chief Executive Russell Hardy. This is up from 252 million tonnes last year, but down from 272 million tonnes in 2021 as Europe's thirst for LNG has taken some permanent supply from Asia.
"Asia in 2023 will still be accessing (LNG) ... The access is there but the price will be much higher. Asia is accessing today less gas than it could access in 2021," he said.
This year, buyers from China to Bangladesh have signed a score of deals with Qatar and U.S. to renew contracts and secure more LNG from the second half of the decade despite expectations that more new projects will come online.
"Everybody had a good lesson learned ... Now customers are again pivoting to higher percentage for long term," said Shamsairi Mohd Ibrahim, vice president, LNG marketing & trading at Petronas at the sidelines of the Energy Asia conference.
"I think that is good, especially for Asia Pacific. We producers need them to commit on long term because it is a long digestion (period) in terms of getting back the returns."
The market has also softened because of a slow recovery in demand from China, one of the world's top LNG importers.
"China has been a wild card for LNG demand. Even though the world economy is weak, China has once played an important role and it was one of the biggest driving force in terms of LNG use," Atsunori Takeuchi, executive officer and senior general manager of LNG business department at Tokyo Gas, said.
"But now the situation is almost upside down. In the spot LNG market, Chinese demand is feeble."