■ The Japanese FTC may challenge LNG destination restriction clause. The vast majority of Japanese Sales & Purchase Agreements (SPAs) have a clause that precludes the buyer from re-selling cargoes. Bloomberg reported that Japan is investigating if these violate competition laws.
■ If implemented, this could materially increase spot excess in Asia. Japan purchased 34% of global LNG in 2015 (CSE); the ability to re-sell could radically increase the quantity of LNG offered in the spot market.
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David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
