Trafigura Group offers two LNG shipments to Pakistan

July 14, 2023 (MLN): In a positive turn of events, Pakistan’s request to buy Liquefied Natural Gas (LNG) received an offer from a supplier for the first time in more than a year, potentially reversing a trend of failed attempts to procure fuel.

Trafigura Group offered two LNG shipments for January to February delivery, according to traders with knowledge of the matter. Pakistan’s last two spot tenders didn’t receive any offers, as Bloomberg reported. 

The move comes as Pakistan’s government finances are on the mend. The nation won final approval to borrow $3 billion from the International Monetary Fund earlier this week, unlocking long-awaited lending that will help ease its dire need for cash, it added. 

The shipments that Trafigura offered are priced at roughly a 30% premium to current market prices, according to traders. Typically, spot purchases of fuel would be sold at similar levels to market prices, it said. 

Pakistan won’t award the tender until July 31, and it still isn’t clear if the country will follow through with buying the fuel.

Credit risk had been a barrier stopping LNG suppliers from selling spot shipments to the nation, it said.

Earlier, Pakistan's tender to buy six LNG spot shipments for Oct.-Dec didn't receive any bids from suppliers.

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