Most LNG traded by Singapore firms bypasses port, METI clarifies

The clarification from Japan's METI comes after Indonesian Energy and Mineral Resources Minister Bahlil Lahadalia raised concerns about LNG shipments originating from Indonesia being subsequently resold to other destinations via Singapore.

According to METI, the bulk of LNG trading activity conducted by Singapore-based firms typically does not involve the actual transfer of physical cargo through Singapore's port facilities. The statement suggests that most transactions are paper trades or involve direct shipment arrangements between producers and end-buyers, with Singapore serving primarily as a trading and commercial hub rather than a transshipment point.

Singapore has established itself as a major global energy trading centre, hosting regional offices for numerous international commodity traders and energy companies. The distinction between physical and paper trading is significant in commodity markets, where traders often buy and sell contracts without taking possession of the underlying goods.

The exchange highlights ongoing discussions between regional governments regarding supply chains and the role of trading hubs in energy logistics. Indonesia, one of Asia's key LNG producers, has sought greater transparency in how its energy exports are handled and distributed internationally.