Equinor's executive states that Europe needs to compete on prices for gas refilling.

A senior Equinor executive said that Europe might need to continue offering attractive prices in order to secure the additional 30 billion cubic meters (bcm), of liquefied gas (LNG), needed to replenish their storage levels.

Equinor estimated that Europe would require around 250-300 additional LNG cargoes in comparison to last year, to fill storage tanks that were left empty by two-thirds after the winter. This would result in a tight gas market.

Peder Bjorland said that securing such volumes would be possible if Europe offered prices competitive with China and other Asian customers.

In an interview conducted on the fringes of the Flame conference in Amsterdam, he stated that "price is the most important thing in this game."

Bjorland stated that China is returning and can be competitive.

China, which is the largest LNG consumer in the world, recorded its lowest LNG consumption since October 2022. It had also been reselling U.S. LNG cargoes into Europe during the tariff war between the United States and China.

Washington and Beijing agreed to a temporary truce earlier this week, which offered some relief. It promised to unblock some two-way commerce that had been halted by the conflict between two of the world's largest economies.

Bjorland stated that the Chinese LNG market is growing.

He said that while we won't see many new LNG purchases in the near future, we may see a decrease in the resale rate of Chinese cargoes to Europe.

The weather conditions will also play a crucial role, as Asian demand is tied to summer air conditioning and European demand to winter heating.

Bjorland warned that a cold winter would make Europe "vulnerable" if its storage was less than 85% filled at the start of the season.

The European Parliament voted earlier this month to relax the requirements for filling gas storage tanks, due to concerns that the current target could result in inflated prices.

Bjorland, speaking of Equinor’s plans to grow LNG production, said that Asia was the largest potential market.

He said that the main growth area for Equinor will be LNG. I believe the fastest growing regions will be Asia, particularly India, China, and Southeast Asia. (Reporting and editing by Tomasz Jánowski; Additional reporting by Nora Buli, Oslo)

(source: Reuters)