Russell: China's LNG crown is at risk due to high prices that limit demand.
Asia's imports liquefied gas remained flat in November. The region that is the largest buyer of this super-chilled fuel will likely record its first decline annually in three years.
China is largely to blame for this soft result, as it may lose its position as the top LNG importer in the world to Japan.
The drop in imports is likely due to the high spot price for LNG, which has been persistent for most of the year.
Asia imported 22.99 millions metric tons (MT) of LNG in the month of November. This is a tiny bit more than the 22.97 in October, and a little higher than the 22,66 in November 2011.
Kpler estimates imports to have rebounded in December. Arrivals are estimated at 26.86 millions tons. This figure is likely to increase as more cargoes arrive and are assessed.
Even with a strong December in Asia, LNG imports will drop to 276 million tonnes in 2025. This is down from 288,8 million tons of 2024, and marks the first annual decrease since 2022.
Kpler data estimates that China's imports this year will be around 64.6 millions tons. This is down from the 78.27 in 2024, and it's lowest since 2022. This estimate is below the 65.62 millions tons that were predicted for Japan in this year.
Delivery of LNG to North Asia
Since April of last year, they haven't dropped below $10 per mmBtu and reached as high as $15.10 in February, during the peak winter demand season for northern heating.
If the spot price is above $10 per mmBtu, it's considered uncompetitive in China against other natural gas sources. Therefore, buyers will only purchase contracted quantities.
India, Asia’s fourth largest LNG importer, and another price sensitive buyer, will also see lower arrivals in 2025. Kpler estimates 24.68 millions tons, down 26.6 million from 2024.
ROBUST EUROPE
Prices are less important in Europe where LNG imports replace Russian pipeline natural gas.
In 2025, imports to Europe are expected to be at least 123.99 millions tons. This would bring them close to the records set in 2022 and 2023 when they were both around 124.6million tons.
Kpler reports that Europe's imports in November were 11,89 million tons, up from 10,63 million in October. This is the highest level since March.
The United States is still the largest supplier of grain to Europe. Last month, the United States supplied 6.90 million tonnes, which was just short of the March record of 6.95 millions tons.
The U.S. exports to Asia are a different story. November's imports, at 1.43 million tonnes, were the lowest since April.
As part of the trade agreements with President Donald Trump's administration, several Asian countries have committed to buying more U.S. Energy. However, purchases have not been ramped up.
Kpler has forecast strong U.S. LNG imports across Asia for December and January. Arrivals of 1,99 million tons are expected in December, rising to a 14 month high of 2,62 million tons in the following month.
The imports include a cargo from the United States for China in December, and another cargo for January. These are the first U.S. cargoes that have arrived in China since this February.
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These are the views of a columnist who writes for.
(source: Reuters)
