Corrects the discount figure in paragraph 10 to $0.065 from $0.650

By Marwa Rashad

LONDON, June 12 (Reuters) - Asia's spot liquefied natural gas price rose this week to its highest in 11 weeks as markets monitor developments in the Iran war and expected hot weather boosts demand.

The average LNG price for July delivery into northeast Asia LNG-AS was estimated at $19.15 per million British thermal units (mmBtu), its highest since March 27 and up from $18.80/mmBtu last week. The price for August delivery was estimated at $19.20/mmBtu, industry sources said.

"Markets are seeming increasingly fatigued in the schizophrenia of the Middle East conflict where diplomacy is increasingly being expressed in military actions among parties ... this increased the risk premium and volatility in a not so well-shaped outlook for Asia," said Klaas Dozeman, market analyst at Brainchild Commodity Intelligence.

El Nino's weather pattern is expected to strengthen, raising prospects of hotter weather in Asia, while strikes at Australia's Ichthys LNG terminal add to the tight outlook, Dozeman said.

Buyers in Bangladesh, India and Pakistan have been busy tendering for cargoes with prices still below $20/mmBtu. Meanwhile, Japanese and South Korean stock levels are lower than seasonal averages and northeast Asian buyers have been buying cargoes to bolster stocks, said Martin Senior, head of LNG pricing at Argus.

In Europe, gas prices at the Dutch TTF hub were around €47 per megawatt hour on hopes of a potential U.S.-Iran deal.

"European gas fundamentals remain fragile, with risks skewed to the upside. Global LNG exports are down year-on-year in June, while Asian LNG imports continue to rise, potentially increasing cross-basin competition for cargoes in Q4 or even earlier if summer risks materialise," said Yahdian Falah, portfolio strategist at German-based energy trading company Trianel.

European gas stocks are at unusually low levels of around 43%. The slow pace of stockpiling is primarily linked to market expectations that, should the Strait of Hormuz be reopened, much more LNG will become available and prices for the coming months will fall slightly, said Hans Van Cleef, head of energy research at Eqolibrium.

Additional demand signals from emerging importing regions, including Egypt and Turkey through recent tender activity, further reinforced competition for spot cargoes. Offers into these markets remained competitive relative to Europe, adding pressure on northwest European supply, said Aly Blakeway, head of Atlantic LNG at S&P Global Energy.

S&P Global Energy assessed its daily northwest Europe LNG price benchmark for cargoes delivered in July on an ex-ship (DES) basis at $16.728/mmBtu on June 11, a $0.065/mmBtu discount to the price at the TTF hub.

Argus assessed the price at $16.740/mmBtu, while Spark Commodities assessed the price at $16.688/mmBtu.

Investment funds have cut their net long position in TTF futures for three weeks in a row, despite obstacles preventing reopening of the Strait of Hormuz, said Seb Kennedy, independent analyst at Energy Flux News.

"Having been burned by a relentless selloff on TTF since mid-March, bullish funds are wary to add more length until fundamentals support a sustained move higher," he said.

Global LNG freight rose this week, with Atlantic rates at $104,500/day and Pacific rates at $82,000/day, said Spark Commodities analyst Qasim Afghan.

The U.S. front-month arbitrage to northeast Asia via the Cape of Good Hope and Panama are both pointing to Asia, he added.