What’s new: The Asian liquefied natural gas (LNG) spot price on Tuesday was $7.10 per million British thermal units (Btus), down nearly 80% from a record high in January, according to Sun Xuelian, a senior LNG analyst at Beijing-based energy information provider JLC.
The steep decline is mainly due to the end of what is commonly referred to as winter heating season, said Guo Jian, an analyst at research firm Sublime China Information. China imported 14.04 million tons of LNG in the first two months of the year, up 27% year-on-year, according to the customs data.
What’s the background: With the newly established state-owned China Oil & Gas Pipeline Network Corp., better known as PipeChina, is opening up its natural gas pipeline network to domestic market players, more small LNG buyers are seeking to purchase it on the international market, Sun said.
However, China’s overall LNG consumption volume is unlikely to result in a substantial increase, Guo said, adding that consumption needs to be analyzed carefully despite increasing import sources.
China’s comprehensive LNG import price index for the week through March 28 rose 1.72% from a week earlier to 86.29 due to warmer weather and the easing supply of spot LNG, according to the Shanghai Petroleum and Natural Gas Exchange.
Contact reporter Lu Yutong (yutonglu@caixin.com) and editor Marcus Ryder (marcusryder@caixin.com)
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