Asian LTC formula for LNG include an S-curve, where the price formula is different above and below a certain oil price, to dampen the impact of high oil prices on the buyer, and low oil prices on the seller. See NaturalGasPricing.
- Dampen JLC (Japan LNG Coctail) volatility that comes from the indexation to JCC.
- Protects sellers when oil price is low and buyers when the price is high.
- Consumers inclined to switch to gas due to lower volatility.
- S-curve is defined by its slope (LNG price relative to reference oil price).