SINGAPORE—Tankers storing LNG in Asian waters have more than doubled in number since late October as traders have been caught off guard by warmer-than-expected temperatures that have capped demand and pulled down prices.

Spot market demand ahead of winter has been slowed by the forecasts for warmer temperatures this year in North Asia, with onshore storage tanks filling up.

“People were expecting China to buy as much as last year in the spot market, but the weather so far has been quite mild and I don’t think they were anticipating that,” a Singapore-based LNG trader said.

LNG prices last year climbed steadily from mid-July to January as China’s gasification push for winter heating sparked higher imports. But this year, buyers from the world’s top natural gas importer—via pipeline and tanker—have been spreading out their purchases more.

Now about 15 to 20 LNG tankers holding at least 2 million cubic meters of LNG worth more than $400 million at spot market prices are floating in Asian waters, industry sources said. That’s up from a half-dozen tankers being used for storage in Asia three weeks ago.

Globally, the number of such LNG tankers stands at 20 to 30, one of the sources said.

This has helped to drive up LNG tanker rates to record highs, the ship broking and trading sources said.

Most of the traders storing cargoes in the tankers are “seeking better winter pricing ... holding out against rising charter rates to achieve an acceptable profit on the molecules,” shipbroking firm Braemar said in a weekly LNG report last week.

This is “creating pain for those producers who are still forced to lift cargoes from terminals which are approaching tank tops.”

Refinitiv Eikon data shows at least eight tankers storing LNG in Singapore waters while two were in Malaysian waters.

More than five vessels that had been storing LNG are now on the move or have discharged the cargoes, the data shows.

Storing LNG on tankers out at sea, unlike crude oil, is generally seen as a risky bet, given the high costs of storage and the fact that cargoes degrade over time by evaporating.

As with other commodities, the play is typically triggered by a market structure known as contango, in which prices for immediate delivery are cheaper than later months.

The contango, which was at about $1 per million British thermal units last month, has since narrowed to about 50 cents or less, traders said.

The last time LNG was put into floating storage on a large scale was in 2014, though the number of tankers was lower, the Singapore LNG trader said.

Not all the cargoes are stranded without buyers.

Some of the companies likely secured the tankers during the summer when shipping rates were far lower, and stored them in anticipation of a pick-up in prices, traders said.