Sept 17 (Reuters) - U.S.-based Cheniere Energy Inc said on Monday that it has signed a 15-year agreement to supply liquefied natural gas (LNG) to the world's largest oil trader Vitol Group that has been steadily ramping up its presence in that market.
The move by Vitol is part of a long-term objective shared by many major commodity traders to increase their traded gas volumes as emerging markets seek cleaner fuels for power generation.
China in particular has soaked up what many analysts expected to be a significant LNG glut this year as it replaces some of its coal furnaces with gas-fuelled ones.
Part of the drive for traders is that the LNG market is becoming increasingly liquid with more spot deals, presenting arbitrage opportunities and supply imbalances that traders thrive off.
Cheniere said it will sell 700,000 tonnes of LNG per year to Vitol, starting in 2018 with a purchase price pegged to the Henry Hub monthly average, plus a fee.
On Monday, Vitol's Chief Executive Russell Hardy told a conference in Barcelona that he expected global LNG traded volumes, currently at 300 million tonnes, to double in the coming years, as new importing countries build facilities.
Last year, Vitol's LNG traded volumes tripled to 7.4 million tonnes up from 2.6 million tonnes in 2016.
The United States has become a major LNG exporter in the last two years, mostly due to the ramp-up of Cheniere's Sabine Pass terminal in Louisiana. Houston-based Cheniere is also building the Corpus Christi terminal in Texas.
Earlier this year, Cheniere signed a similar agreement with rival Trafigura, a major Swiss-based commodities trader, for 1 million tonnes.
Along with long-term supply deals, Vitol has been competing to build LNG import infrastructure in Southeast Asia, pitting itself against Gunvor and Trafigura in Pakistan and Bangladesh. (Reporting by Julia Payne in London, John Benny in Bengaluru; Editing by Arun Koyyur, Shounak Dasgupta and Adrian Croft)