Russian Volumes Enter South Korea

After China and India in previous months, Russian helium volumes have now reached South Korea. Over the last three months (Jan-Mar'24), South Korea imported a total of 5mmcf from Russia, with 1mmcf in Jan'24 and ~2mmcf/month in Feb-Mar'24. Although Russian volumes currently account for only 5% of South Korea's total imports, they pose a potential threat to South Korea’s other major sources, Qatar and the US. Prices from Russia ranged between US$490-520/mcf, which is in between the averages of South Korea's other major sources: Qatar and the US, which have averaged US$480/mcf and US$570/mcf over the LTM, respectively. We believe there is significant potential for Russian volumes to increase in the region, as was the case with China after initially low volumes which then spiked 3x. It is difficult to predict whether this will cannibalise volumes from other regions or supplement existing imports and restore them to pre-2022 levels before the demand destruction caused by high helium prices and weak semi-conductor demand.

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