Three benchmarks, each rooted in a different regional gas market, do most of the work of describing what LNG is “worth” at any given moment — and the fact that there are three of them, not one, is itself the point.
JKM: north-east Asia
The Japan Korea Marker is an assessed price for LNG cargoes delivered into Japan and South Korea, the two countries that have historically anchored Asian LNG demand. It is published by a price reporting agency based on observed transactions and market assessments rather than trades executed on a single central exchange, which is typical of how physical commodity benchmarks work outside of futures markets.
JKM has become the reference most commonly used for spot and short-term Asian cargoes, and increasingly appears in the pricing formulas of newer long-term contracts serving the region, alongside or instead of oil indexation.
TTF: north-west Europe
The Title Transfer Facility is a virtual trading point in the Netherlands — not a physical location but a notional point where gas ownership can be transferred within the Dutch and, by extension, much of the connected north-west European pipeline grid. It has become the principal reference for continental European gas prices generally, not only for LNG.
Because European import terminals regasify LNG directly into the same pipeline grid that TTF prices, an LNG cargo delivered into Europe is, in effect, competing against and being priced relative to whatever piped and stored gas is trading at on the same network at the same time. TTF is therefore less an “LNG price” in the way JKM is understood and more the price of gas in a market LNG has to sell into alongside every other source of supply.
Henry Hub: the United States
Henry Hub is a real, physical pipeline interconnection point in Louisiana, and its price has been the standard reference for US domestic gas for decades, well before LNG export from the US became significant. Most US Gulf Coast liquefaction capacity built under the tolling model prices its feed gas off Henry Hub, with the liquefaction fee added on top as a separate, largely fixed component.
This structure is part of why US-origin contracts tend toward hub pricing rather than oil indexation: the underlying feed gas cost is already set by a domestic hub price, so referencing that same hub in the export contract is the more direct and transparent mechanism, rather than introducing an oil-linked formula for gas whose actual cost has nothing to do with oil.
Why there is no single global LNG price
Each benchmark reflects the supply and demand balance of a genuinely distinct regional market — different production sources feeding it, different storage infrastructure, different seasonal demand patterns, different degrees of pipeline interconnection with neighbouring markets. A cold winter in north-east Asia moves JKM without necessarily moving TTF by the same amount at the same time, and a supply disruption affecting European pipeline imports moves TTF independent of what is happening in the Gulf of Mexico.
Cargoes can and do move between these regions, which is what links the benchmarks together over time — a sufficiently large and sufficiently persistent price gap between two regions attracts cargoes toward the higher-priced one, pulling the two prices back toward each other. But that linkage operates through shipping availability and takes time, and a wide, sustained relative gap between the benchmarks is a normal, recurring market condition rather than an anomaly requiring explanation.
Why these benchmarks matter even under an oil-indexed contract
A buyer and seller negotiating any contract, however it is ultimately priced, are implicitly asking what the alternative would cost — what a hub-referenced deal would deliver instead of the oil-indexed formula on the table. The benchmarks function as the market’s shared reference points for that comparison, which is why they are quoted and watched closely even by participants whose own contracts reference something else entirely.
What this means for reading market commentary
A reported “LNG price” that does not name which benchmark it refers to is not fully specified, in the same way a reported “capacity” that does not state its unit and status basis is not fully specified. JKM, TTF and Henry Hub can and regularly do diverge meaningfully from one another, and a figure attributed simply to “the LNG market” without naming its benchmark and region should be read with the same caution this course has applied throughout to any unqualified number.