China’s demand for liquefied natural gas is on course for yet another annual decline this year, estimates from BloombergNEF suggest. The outlet expects Chinese LNG demand to be 5% weaker this year than last, at 73 million tons.
Such a development would dethrone China as the largest LNG importer in the world, with the dubious import-dependence crown going to Japan.
The BloombergNEF forecast follows reports earlier this week that revealed China’s LNG imports have been on the decline for 13 months straight. The country’s November total in imports is seen at 5.81 million tons, which would be a 5.5% decline from a year ago, Kpler said this week. The decline would be significantly smaller than the ones registered for the previous two months, both of which were at over 10% on the year.
Bloomberg noted in its report on this year’s LNG imports that China used to be the fastest-growing import market for liquefied gas prior to 2022 and the spot market price surge following Russia’s invasion of Ukraine. As prices changed, so did China’s demand.
At the time, BNEF forecast China’s LNG imports for 2025 at as much as 100 million tons. Since then, the forecasting outlet has had to revise its projections repeatedly to reflect the close link between price movements and purchasing behavior.
There has also been another factor affecting China’s appetite for liquefied gas, and that is the Power of Siberia pipeline from Russia, which has been pumping ever-growing volumes of gas. Earlier this year, the two countries also signed a deal for the expansion of the pipeline, which would double its capacity to over 100 billion cu m of natural gas per year.
Meanwhile, China has also been working on boosting its domestic natural gas production, and the efforts have been paying off, with output hitting an all-time high earlier this year.
By Irina Slav for Oilprice.com
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