European and Asian gas benchmarks climbed again, with the TTF October contract settling at 73.640 euros per megawatt-hour, up 5.45%, while the JKM October contract reached 23.615 US dollars per million British thermal units, a 4.01% gain. Meanwhile, NYMEX October Henry Hub futures edged 0.58% higher to 2.946 US dollars per million British thermal units.

According to data from S&P Global's CERA, the European Union imported approximately 7.6 million metric tons of liquefied natural gas in August, equivalent to around 10.4 billion cubic meters. This marks a modest increase from July's 6 million tons and edges past the roughly 7.3 million tons imported in August of the previous year, representing the first month-over-month and year-over-year growth in EU imports since March. For much of the year, trade disruptions tied to the Middle East conflict had hindered Europe's ability to attract cargoes, intensifying competition with Asian buyers for limited supply.

After more than three months of scheduled maintenance, Australia's Prelude floating LNG facility is expected to resume operations, with plans to export roughly three to five cargoes per month. Given the extensive upkeep, the project should be able to enhance operational efficiency during the upcoming winter. The LNG carrier Seapeak Magellan has already arrived at the Prelude site in Western Australia. Primary destinations for Prelude cargoes include South Korea, Japan, and Singapore, where buying interest has begun to surface as Asian importers delve deeper into October procurement following the force majeure extension in Qatar.

In Vietnam, progress continues on the proposed 1.5-gigawatt Thai Binh LNG-to-power project in Hung Yen province, with engineering consultancy AFRY recently selected as the international technical advisor. AFRY stated on August 31 that this appointment will strongly support LNG infrastructure development as Vietnam's electricity demand keeps growing, further boosting the nation's power generation capacity.

Investment logic

In the Asian and European markets, European gas prices continue to strengthen modestly after breaking to new highs, despite the rebound in spot LNG arrivals and expectations of increased Australian exports. Europe's current pace of replenishing storage remains difficult to accelerate quickly. In the short term, both markets are likely to maintain a firm, range-bound tone as they price in replenishment pressure. At current levels, attention should be paid to potential shifts in Middle East geopolitics or any EU policy measures aimed at curbing the market.

In the US market, production remains elevated, but early September heat has boosted demand expectations, leading to a modest rebound followed by range-bound trading. The key resistance level to watch is the 3 US dollar mark.

Strategy

Europe's storage refill issue has not shown substantive improvement, so existing long positions in TTF should be maintained. Asian purchasing urgency is weaker than Europe's, suggesting potential for the TTF-JKM spread to widen further.

Risks

Upside risks include stronger Asian autumn replenishment demand and Middle East conflicts disrupting production and export facilities. Downside risks include a rapid easing of Middle East tensions and weak macroeconomic conditions suppressing demand.