The price of liquefied natural gas (LNG) in China’s domestic market has hit a record high due to extremely low temperatures, with importers likely to increase supplies from the spot market, further pushing global supply.
The national average price for gas, which is transported by trucks to factories or service stations, rallied nearly 80% last month to 8,114 yuan per tonne on Tuesday, according to the Shanghai Oil and Gas Exchange. Temperatures in Beijing on February 12-22 were lower than the average for the same period, while the cold will persist until Thursday, according to the Global Forecast System, according to Bloomberg.
Domestic prices for LNG in China are freely adjusted in market terms, in contrast to the state-regulated price of piped gas. China is the largest importer of natural gas in the world, so LNG stock prices serve as a picture of the supply and demand situation in the second largest economy in the world.
If China boosts spot markets, the gas supply situation in Europe, which is struggling with low reserves and fears of a tool use by Vladimir Putin’s pipelines from Russia, will become even more difficult.
Source: Capital
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