From S&P Global Platts, February 8:
Global LNG trends kick off this week's selection of energy and raw material trends, as the dust settles on January's unprecedented price spike. Plus, EU carbon prices hit a new record, Algeria looks to shore up its hydrocarbons sector with new legislation, and tighter corn supply poses a quandary for livestock farmers.
1. PipeChina auction results highlight LNG demand upside...
What's happening? PipeChina approved 54 third-party shippers to import LNG through the national infrastructure company's 8.4 Bcm of spare LNG regasification capacity through Dec 2021. All of the spare capacity is located at terminals servicing Southern Chinese demand centers, which are expected to see domestic gas prices of ~$8.00/MMBtu in S-21, well above expectations for JKM, highlighting the potential for an uptick in spot LNG procurement.
What's next? Strong interest in available capacity could foreshadow broader LNG demand growth as government efforts to increase gas penetration across Southern China intensify. Historically, government efforts to increase gas penetration in Northern China corresponded with a strong uplift in utilization of Northern China LNG terminal capacity. With government policy on gas now shifting focus to Southern China, this recent auction could signal the beginning of a similar trend, supporting overall Chinese LNG demand. S&P Global Platts Analytics anticipates Chinese LNG demand growth of 12% through 2025, reaching 114 Bcm, a growth trend highly dependent on success in broader gas penetration policies outside of Northern China.
2. ...while Asia premium slide portends more US LNG to Europe in short term...
....MUCH MORE
