China’s gas imports are soaring this Spring. Chinese companies were very actively buying LNG months before Russia’s invasion in Ukraine.Current natural gas market prices remain depressed compared to record prices in 2022. However, indications suggest that the current low prices may soon become a thing of the past, especially if China brings online its significant LNG regasification projects within the expected timeframe and continues to exert influence on global markets.
At the same time that there is a sign of growing natural gas demand by China, a report by GlobalData states that China will be dominating the LNG regasification capacity additions in Asia. GlobalData states that 34% of all Asian additions will be in China. In its report, ‘LNG Regasification Terminals Capacity and Capital Expenditure Forecast by Region, Key Countries, Companies and Projects , 2023-2027’, China is slated to add around 5.7 TCF from already received project approvals, while 2.
Even after the Russian invasion started, Chinese parties continued to close deals. Until April 2022, 57% of all LNG purchase deals were signed by Chinese parties. Between September 1 2021 and April 1 2022, around 23 million tons of LNG imports per year were agreed on. This volume is remarkable, knowing that between 2006 and 2020 Chinese deals averaged around 5 million metric tons per year, or 15% of the global market.