A cold snap across Spain is expected to last through mid-January has resulted in natural gas prices more than doubling in the last week, according to Bloomberg.
LNG prices trading at Spain's Punto Virtual de Balance (PVB) gas trading hub hit a record 51.55 euros ($63.13) a megawatt-hour this week, or $18.54 per million British thermal units as the nation grapples with dangerously cold weather and snowfall in Madrid.
Spain has one of the largest LNG terminals in Europe. "Surging prices, coupled with a lack of available LNG vessels for longer journeys between Europe and Asia, will probably limit cargo exports from the nation's ports and further tighten the supply of the fuel," Bloomberg noted.
Frigid weather in China has resulted in surging LNG prices as well. This week Beijing meteorological station recorded one of the coldest temperatures in decades this past week, sending power demand through the roof. LNG imports in China last month were at record highs as demand to heat homes has surged.
A possible theory behind the wicked cold weather could be the sudden stratospheric warming splitting the polar vortex into two, allowing Arctic temperatures to pour into Europe and Asia.
"A strong sudden stratospheric warming event (SSWE) over the Pole has temperatures spiking in the Arctic, plummeting in portions Europe and Asia.
The remnants of the Polar Vortex (PV) has also aided in unusual heavy snow in the forecast across portions of Spain in...forecast models spitting out over 12" + of snow in the short term. While these areas of the world feel more "wintry", it has allowed especially the northern half of the US to run much above normal in temperatures, losing our tap to cold air. Signs will need to be watched getting later into January, however, for the increased potential for cooler or colder outbreaks of air across the eastern/southern US if we can move the remnants of the PV more towards the US," said Kirk Hinz, meteorologist with BAM Weather.