LNG stocks at Japan’s power utilities fall on week

Japan's main power utilities reduced their LNG inventories last week, but stock levels remained well above a year earlier and the end-November average in the past five years.

LNG inventories held by the main utilities stood at 2.53mn t as of 27 November, down by 3pc from a week earlier, according to a weekly survey by the trade and industry ministry (Meti). But this was up by 17pc from 2.16mn t at the end of November last year, and higher by 30pc against 1.95mn t or the average of stocks levels in end-November during 2017-2021.

The weekly drop came, despite stable electricity demand that resulted from relatively mild weather. This suggests the utilities received less LNG last week, possibly because recent high inventory levels discouraged them from buying excess spot cargoes.

Japan's power demand averaged 91GW during the week to 27 November, down by 1pc from a week earlier, according to nationwide transmission system operator the Organisation for Cross-regional Co-ordination of Transmission Operators. Temperatures at the country's 10 major cities averaged 14.2°C, up by 0.8°C over the same period, the Japan Meteorological Agency data showed.

The latest power demand was below Japan's available thermal generation capacity which averaged 106GW, of which gas-fired capacity accounted for 58pc at 61GW, according to data provided by the Japan Electric Power Exchange. This implies the country's thermal units were not fully utilised, given the availability of other cheaper sources such as nuclear, hydropower and renewables.

By Motoko Hasegawa