Wood Mackenzie has reported that after a slow 2020, LNG demand in Asia returned to growth in the first five months of 2021, with China being the single biggest contributor. With Japan’s LNG demand in decline, China is set to become the world’s largest LNG market this year according to energy intelligence group Wood Mackenzie.

LNG may well become a cost-disadvantaged supply option versus pipeline imports over the next two years. Although spot LNG has been the most competitive gas import opportunity into China for the past two years, rising prices have now brought this competitive advantage to an end.

Rising electricity consumption has been in the spotlight since the start of 2021, pushed by China’s economic recovery. Strong electricity demand has been a main driver for increased LNG imports particularly in southern China. These sectors have all maintained strong LNG demand.

The report showed that domestic production achieved 12 percent year-on-year growth in the first quarter of 2021 to ensure supplies during the heating season, while piped gas imports also increased, rising by 5 percent year-on-year.

The researchers were confident that China will likely remain the world’s top LNG importer for several years.

For more information visit www.woodmac.com

28th June 2021