Japan–Korea liquefied natural gas (LNG) prices have risen above $23/MMBtu, their highest level since January 2023, as extreme heat drives up power demand and supply disruptions in the Middle East tighten the global fuel market. Japan’s Meteorological Agency has warned of unusually high temperatures across the country, increasing reliance on gas-fired power generation.
At the same time, the market is grappling with heightened uncertainty over shipments through the Strait of Hormuz, a critical corridor for global LNG trade. Flows through the strait have been disrupted since an Iranian attack in July on a Qatari-owned tanker, raising doubts about the reliability of Middle Eastern supplies to Asia. These concerns are being compounded by ongoing US efforts to intensify economic pressure on Tehran.
The disruption is particularly significant for Japan and South Korea, which depend heavily on LNG imports to meet their energy needs, leaving both countries especially exposed to any further instability in Middle Eastern supply routes.
