China’s imports of liquefied natural gas (LNG) for the month of November could hit 4 million tons surpassing the previous record of 3.7 million tons the country imported in December last year.
The increase in imports is a response to rising demand boosted by a government-led switch from coal to natural gas for heating of millions of households in the northeast regions of Tianjin and Hebei, as well as a colder start of the winter, Reuters reports.
The major part of the demand will be covered by LNG imports which resulted in Asian spot LNG prices going up 80 percent, closing in on $10 per mmBtu mark. China’s domestic gas price hit $1,060 per ton during the week.
Citing an LNG trader, Reuters reports that China has been increasingly supplied from the spot LNG market, which bumped the liquidity of the market dominated by long-term deals.
This also resulted in the tightening of the Asian LNG market, usually oversupplied, but analysts note that rising output from Australian LNG projects would ensure ample supply for the market despite Chinese imports rise.
An earlier report by the consultancy Poten & Partners shows that China is also boosting its import capacity from 62 million mt per year to 70 million mt as four new terminals begin commissioning during 2018.
LNG World News Staff