According to AA energy, China imported about 39 million tons of LNG last year, surpassing the 38 million tons of South Korea and becoming the second largest LNG country in the world. Further, according to the analysis of S & P global Platts, China's LNG demand is expected to double in 2023, reaching 68 million tons / year, and surpass Japan by 2030, becoming the world's largest LNG consumer. According to the IGU, although Japan imported 83.5 million tons of LNG in 2017, greatly exceeding China, according to the prediction of several authoritative institutions, China will become the largest LNG importer in the next 10 years. The reasons are twofold:
On the one hand, China's increasing demand and import of LNG. According to the IEA, China is expected to contribute 37% of the global natural gas consumption growth in 2017-2023, higher than any other country; In 2019, it will surpass Japan and become the world's largest natural gas importer. It is estimated that by 2023, China's natural gas import will reach 171 billion cubic meters, most of which will be LNG and liquefied natural gas. In addition, China hopes that by 2030, the proportion of natural gas in China's primary energy consumption will reach about 15%, which means that about 65% of the natural gas demand needs to be imported.
On the other hand, Japan may reduce its demand and import. According to Drury's prediction, from this year to 2022, Japan's LNG import volume may drop to 78 million tons (a rate of 1.2% per year). The reason is that according to the fifth basic energy plan of the government, Japan will use renewable energy to produce 20-22% of its total power in 2030, while the current share is 10%. Meanwhile, despite concerns about nuclear energy safety, Japan will use nuclear energy to produce 22% ~ 24% of its total power in 2030, while in 2016, this share was only 1.1%.
China's demand for heating and environmental protection this winter is expected to further promote the surge of LNG demand in the next few months.
There are several reasons why we should pay attention to the price changes and trends of LNG:
1. The import volume is so large that it is very important for the cost accounting of Asian importing countries;
2. The LNG price difference in each region directly affects its arbitrage trade, and then changes the flow direction of LNG cargo, which has an impact on the shipping industry;
3. In view of China's historical experience of "what you buy is expensive", it is worth studying and taking precautions;
4. Natural gas and LNG are inherently substitutes for oil. Natural gas and LNG have the properties similar to petroleum strategic materials. The influence of international politics on their prices cannot be ignored.
As the global LNG trade contract structure has changed in recent years, for example, the term has become shorter and shorter, the terms are more flexible (the destination is no longer limited), and so on, the LNG spot market trade has become more and more active, and the price fluctuation has become more violent. The price of Asian LNG is like a roller coaster.
