LNG: New Korean President’s Policies Could Boost LNG Demand: Platts
South Korea's new President Lee Jae-myung, inaugurated on June 4, aims to shift the country’s energy policy toward renewables, a likely boost for the country’s LNG demand, Platts said.
- Lee, who has long raised concerns about nuclear safety and waste, plans to reduce reliance on nuclear power, reversing Yoon’s nuclear-first strategy.
- Industry officials expect this change to increase demand for LNG to ensure stable electricity supply as renewables expand.
- Under Yoon’s administration, nuclear power became the leading electricity source in 2024, accounting for 32% of generation, up from 26% in 2019.
- Coal’s share dropped from 40% to 28%, while LNG’s share rose slightly from 26% to 28%.
- South Korea's power sector operates under a cost-based pool system, favouring cheaper fuels like coal and nuclear.
- As nuclear use declines under Lee’s policy, LNG is expected to fill the gap during peak demand to prevent power shortages.
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US TSYS: Early SOFR/Treasury Option Roundup: Focus on Midweek FOMC
Option desks report mixed SOFR & Treasury options overnight, lighter volumes with multiple spring holiday closures in Asia and UK. Focus on Wednesday's FOMC policy annc, no rate change expected. Underlying futures mixed, curves twist steeper with the short end outperforming weaker Bonds (2s10s +2.465 at 50.697, 5s30s +3.158 at 90.038). Projected rate cut pricing largely steady to late Friday levels (*) as follows: May'25 at -0.5bp (-0.8bp), Jun'25 at -8.4bp (-8.4bp), Jul'25 at -25.5bp (-25.7bp), Sep'25 -46.9bp (-45.6bp).
- SOFR Options:
- +4,000 SFRZ5 95.93 puts, 9.5 ref 96.475
- 2,000 SFRK5 95.93/96.00 call spds ref 95.80
- over 3,500 SFRK5 96.06 calls, 0.5 ref 95.81
- Treasury Options:
- over 7,500 TYM5 112 calls, 25 last
- 1,600 FVM5 107/107.5 put spds ref 108-14.25
- 2,000 TYM5 110.5/111.25 put spds, 22 ref 111-06.5
- over 3,200 TYM5 111.25 calls, 46 ref 111-08
- 1,000 TYM5 111/112/113/114 call condors
- 1,600 FVM5 107.25 puts ref 108-15.25
USD: The Dollar is still pushing lower
- Further intraday lows for the Dollar, nothing fast, 1 pip at a time, but it has been a one way move so far during the early European session and into the US one.
- EUR, GBP, NOK, AUD, JPY, PLN, ZAR, and CAD are all at session high, and this is more of a pure FX move, given the lack of moves in Equities or eve Bonds (Yield).
- AUD is still the best performer and is still eyeing a test to the 0.6500 handle.
EQUITIES: EU Bank put fly
SX7E (19th Sep) 160/155/150p fly, bought for 0.20 in 6k.
