Uncertainty in Japan and Korea's LNG markets

摘要

Policy and regulatory uncertainty in Japan and South Korea could result in less new LNG supply being developed, forcing continued tightness in the Pacific LNG market beyond 2020 and perpetuating relatively high spot prices, according to market analyst Wood Mackenzie. This is contrary to general market consensus that the market will see relief around the 2018 timeframe. While the governments of Japan and South Korea are actively promoting greater competition between new LNG suppliers to encourage lower priced LNG, uncertainty regarding nuclear generation and market liberalisation may have the opposite effect and increase the cost of LNG procurement.