The Japan-Korea Marker has been the de facto reference price for Asian LNG spot transactions since Platts (now S&P Global Commodity Insights) established it in 2009. It is assessed daily, published at 5:30pm Singapore time, and used as the basis for swap settlements, delivered price calculations, and spot tender reference pricing across the Pacific basin.
JKM entered February 2026 trading approximately $14–15/MMBtu — moderately elevated, reflecting the post-winter stock draw and early demand build from industrial recovery after the lunar new year period. The Chinese Spring Festival season typically creates a brief demand lull followed by rapid industrial demand recovery in the weeks after the new year, and 2026 is following that seasonal pattern.
For sovereign buyers whose procurement strategy is simply “buy spot against JKM when we need it,” this price environment translates directly to high import costs and domestic pricing pressure. The buyers operating differently — treating JKM as market intelligence rather than a price they must accept — are achieving materially lower effective import costs over time.
What JKM is and what it is not
JKM is a spot price assessment, not a traded futures price in the traditional sense. S&P Global Commodity Insights calculates JKM through a market-on-close methodology that gathers bid, offer, and transaction data from market participants in a defined window. The assessment reflects the last 10–15 days of Pacific delivery position.
This methodology has implications that buyers should understand:
JKM reflects near-term supply-demand balance, not fundamentals. A spike in JKM during a cold snap reflects short-term physical tightness in the Pacific basin. It does not mean global LNG fundamentals have deteriorated. A buyer who understands this can wait out the spike if they have supply flexibility, rather than purchasing at peak prices.
JKM liquidity is thin. The physical spot LNG market in Asia involves far fewer transactions per day than commodity markets of comparable size. A few large cargo purchases or emergency procurement tenders can move JKM materially. This means that JKM can be influenced by individual participants in ways that oil prices or TTF cannot.
JKM is not the only Asian LNG price. Long-term contracts in Northeast Asia are predominantly oil-indexed (JCC-linked), not JKM-linked. The portfolio of an Asian utility or NOC typically has a mix of oil-indexed long-term volumes, JKM-indexed medium-term volumes, and pure spot purchases. JKM matters most for the third category.
How sophisticated buyers use JKM
JERA, Japan’s largest power company and LNG buyer, has built a portfolio management capability over the past decade that genuinely sophisticated. JERA participates in the spot LNG market as both buyer and seller — selling excess volumes from its long-term contracts when JKM is high and buying spot when JKM is soft. This behaviour is only possible because JERA has: upstream equity LNG investments that give it physical long positions; trading infrastructure that can manage the financial hedges associated with spot activity; and a corporate structure that allows market participation beyond pure physical procurement.
KOGAS (Korea Gas Corporation) has similarly evolved from a pure off-take buyer to a more active portfolio manager, with equity interests in Qatar’s RasGas (now part of QatarEnergy), Australia’s Prelude FLNG, and other upstream assets that give it supply cost exposure different from its contract obligations.
The pattern repeats among the most capable buyers: diversified supply sources, a mix of contract pricing structures, active spot market participation as both buyer and seller, and financial hedging capability for price exposure management.
What this means for Malaysian and Southeast Asian buyers
PETRONAS, as both seller and buyer, sits at the top of this sophistication curve in the region. PETRONAS Global Trading participates in the JKM market as a price-maker as much as a price-taker — its volume in the Pacific basin is large enough that its procurement decisions influence the assessment.
For smaller sovereign buyers in Southeast Asia — state utilities in Vietnam, the Philippines, Bangladesh, and Pakistan — the gap is wide. Most are price-takers in the purest sense: they tender for cargoes and accept the market price at the time of their tender. Their procurement scheduling is driven by domestic demand urgency rather than market opportunity.
The practical steps toward more sophisticated price management:
Strategic cargo inventory. Maintaining a buffer of 1–2 cargoes above immediate operational requirements allows buyers to skip a high-JKM procurement window without a supply crisis. This requires either physical storage capacity at the receiving terminal or a charter party with temporary floating storage capability.
Diversified pricing structures. Adding JCC oil-indexed supply to a portfolio dominated by spot JKM purchases reduces exposure to Asian gas market tightness specifically. When JKM spikes due to cold weather or supply disruption, oil-indexed contract volumes maintain stable delivered costs.
Forward purchasing through portfolio traders. Major integrated LNG traders — Shell, TotalEnergies, BP — can offer forward-dated cargo commitments at prices reflecting a forward JKM curve, providing price certainty for upcoming procurement windows. This does not eliminate price risk but allows buyers to lock in supply for predictable demand periods before the spot window opens.
JKM swaps. Financial hedging of JKM exposure is available through the CME Group JKM futures contract. Daily volume in JKM futures has grown substantially since 2020 but remains a fraction of comparable Henry Hub or TTF contract volumes. The primary users are large Asian utilities and portfolio traders. Sovereign buyers with sufficient financial infrastructure and regulatory approval for derivatives can use JKM swaps to lock in effective purchase prices ahead of physical delivery.
The China factor in 2026 JKM
China’s behaviour in the spot LNG market has an outsized effect on JKM in 2026 for two reasons:
First, the three Chinese majors — CNOOC, CNPC, Sinopec — collectively represent approximately 30% of Pacific basin LNG demand. When all three are procuring spot simultaneously, JKM rises. When Chinese domestic gas production has a strong month, Chinese spot buying retreats and JKM softens. National Bureau of Statistics China monthly gas production data is therefore one of the most useful leading indicators for JKM near-term direction.
Second, Chinese buyers hold increasing amounts of long-term contracted LNG — from Qatar, the US, and elsewhere — that creates residual volumes when domestic demand is softer than contracted volumes. Those residual volumes find their way to secondary market as spot or short-term sales, which adds supply to the Pacific basin spot pool and presses JKM lower.
In February 2026, post-Lunar New Year, Chinese industrial demand is recovering and JKM has firmed modestly from its seasonal low. The question for the month is whether the recovery holds into March or whether Chinese spot buying remains cautious while industrial demand assesses the Q1 activity trajectory.
Social media pulse
JKM post-Lunar New Year 2026: $14.50 and holding. Chinese industrial buying returning gradually. No spike in sight but the floor looks solid at $13-14. The interesting dynamic this year is how much contracted Chinese LNG from NFE ramp will show up on secondary market — that's the bearish wildcard that's hard to model.
February 2026 · @ICISgas on X →
The buyers who have real agency in the Asian LNG market are the ones with cargo inventory buffers, mixed pricing portfolios, and trading desks. The rest are just tendering reactively and paying whatever the market is at the moment they're squeezed. The sophistication gap in this market is wide and getting wider.
February 2026 · @saulkavonic on X →
A practical note on tender timing
One of the most consistently underutilised tools for sovereign buyers is procurement timing optimisation. JKM has predictable seasonal patterns: softer in spring and autumn shoulder months, firmer in summer cooling peak and winter heating peak. Buyers who time their supplementary spot procurement for Q2 and Q3 — buying forward for Q4 and Q1 delivery — consistently achieve lower average prices than those who procure reactively in Q4 and Q1 at peak-demand prices.
This sounds obvious. In practice, procurement timing is often driven by internal budget cycles, ministerial approval calendars, and regulatory processes that have nothing to do with market opportunity windows. The buyers who have structured their procurement workflows to accommodate market-timed purchasing — even if it requires maintaining pre-approved framework contracts with multiple suppliers — achieve a real cost advantage over the course of a contracting cycle.
This structural change — moving from reactive to proactive procurement governance — is one of the most impactful improvements a sovereign buyer’s LNG organisation can make. It costs relatively little in institutional terms and saves significantly in commercial terms.
Global LNG advises sovereign buyers on JKM strategy, procurement workflow design, and portfolio pricing structure. Contact our team to discuss how your organisation can achieve better pricing outcomes.