Key facts
- China's national average LNG price was $21.97 per mmBtu on November 9, almost $10 below the Japan/Korea Marker benchmark, Bloomberg reported.
- State-owned Chinese energy majors have finished stockpiling gas and begun releasing inventory, according to the report.
- Chinese energy traders curbed LNG imports earlier this year when prices topped $20 per mmBtu, extending curbs into September.
- Asian spot LNG prices have remained above $31 per mmBtu, with the latest close at $31.49.
- European futures prices fell to €86.80 per MWh from over €100, which the report linked to Middle East optimism after U.S. midterm elections.
China is importing less liquefied natural gas even as peak demand season begins, with an abundant domestic supply pushing prices below global benchmarks. The Chinese national average for LNG stood at $21.97 per million British thermal units on November 9, almost $10 below the Japan/Korea Marker benchmark, Bloomberg reported.
State-owned energy majors have finished their gas stockpiling drive and begun releasing gas from inventory, according to the report. The ample domestic supply has made spot market LNG purchases unattractive to Chinese buyers.
China is one of the world's largest buyers of LNG and, as a result, one of the most price-sensitive. Earlier this year, Chinese energy traders curbed imports when prices exceeded $20 per mmBtu, and the curbs continued into September as prices remained high. Chinese buyers are also seeking alternatives to Middle Eastern LNG.
The reduced Chinese demand could benefit other Asian importers and Europe, which are both trying to secure enough gas for winter. European buyers tend to have deeper pockets and outbid Asian buyers when prices rise high enough to deter the latter.
In late October, Asian spot LNG prices topped $30 per mmBtu for the first time since December 2022, amid continued disruption to Qatar's LNG exports and a growing imbalance between global demand and supply, despite rising U.S. exports. Prices have stayed above $31, with the latest close at $31.49 per mmBtu.
On the European futures market, prices have fallen from over €100 per MWh to €86.80, which the report linked to renewed optimism about the Middle East after Democrats won control of both houses in the United States.