January 6, 2024 [Oil Price]- Asia’s LNG imports jumped in December to a record-high for any month in history as China regained the top importer spot from Japan and lower spot prices incentivized purchases.
Last month, imports of LNG into Asia rose to 26.61 million metric tons, per data from commodity analysts Kpler cited by Reuters columnist Clyde Russell. Imports increased from the November level of 23.35 million tons and were also higher than the previous Asian LNG import record of 26.15 million tons set in January 2021, according to the data Kpler has compiled.
China, Japan, and South Korea all saw higher LNG imports in December, with Japanese purchases at the highest level since January 2023 and South Korean imports at their highest since February 2021, per Kpler’s estimates.
Despite the surge in LNG imports, Asia’s spot LNG prices fell at the end of 2023 to their lowest level in four months, as Asian demand was tepid in the autumn and exports from the top LNG exporters, the United States, Australia, and Qatar, also surged.
In the week to December 29, the average LNG price for February delivery into northeast Asia fell to $11.70 per million British thermal units (MMBtu) from $11.90 per MMBtu in the previous week, to the lowest levels since August, industry sources told Reuters.
In 2023, China regained the top LNG importer spot from Japan, as Beijing’s LNG imports increased by 12% to nearly 71 million tons, ship-tracking data compiled by Bloomberg showed earlier this week.
High LNG import levels in China and the rest of Asia could create more competition for LNG supply to Europe, which is now more dependent on the super-chilled fuel for its natural gas supply after the loss of a large part of the Russian pipeline gas supply.
The relative calmness in the LNG market in recent months could turn into volatile turbulence again if fresh supply concerns emerge and if this winter is really cold in Europe and/or Asia.
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