LNG imports in Asia hit record

While the LNG supply surge keeps price spot prices remained as shipments from top exporters Australia and the United States also hit all-time highs, Asia witnessed a record-breaking surge in liquefied natural gas (LNG) imports during December, reaching an unprecedented 26.61 million metric tons, as reported by commodity analysts Kpler.

05.01.2024 - 10:28 Created at

Despite the robust demand, spot prices remained subdued, influenced by soaring shipments from major exporters like Australia and the United States, both hitting all-time highs.

China emerged as a pivotal player, driving the rebound in imports and reclaiming its position as the world's largest LNG buyer in 2023 from Japan. China's LNG imports surged to 8.22 million tons in December, marking a substantial increase from 6.97 million in November and reaching the highest level since January 2021.

Other heavyweight importers in Asia also experienced gains, with Japan landing 6.78 million tons, the highest since January 2023, and South Korea's December imports reaching 5.10 million tons, the highest since February 2021.

Despite the remarkable demand, the spot index witnessed a decline to $11.70 per million British thermal units (mmBtu) in the seven days to Dec. 29, the lowest since August. The spot price experienced a 58.2% drop over 2023, reflecting eased demand after the surge in 2022 driven by Europe's efforts to replace Russian pipeline natural gas.

Europe, too, saw an increase in LNG imports in December, reaching 11.80 million tons, the highest since April of the previous year. However, soft demand in preceding months, attributed to mild winter weather and ample inventories, limited the demand for spot cargoes.

While demand strengthened in December, the three major LNG suppliers—United States, Australia, and Qatar—also reported robust export performances. The United States, now the world's largest exporter of LNG, shipped out 8.56 million tons, setting a new monthly record. Australia and Qatar also experienced record December exports.

The surge in both demand and supply raises questions about the outlook for spot prices post the winter peak demand period. If supply remains steady, a decline in prices may be necessary to attract more buyers to the market. A spot price retreat below $10 per mmBtu could lead to increased purchases by countries such as India, Pakistan, and Bangladesh.

India, a price-sensitive buyer, saw a slight drop in LNG imports to 1.86 million tons in December, but the figure was higher than December 2022. It's noteworthy that India's highest imports coincided with a period of record-low spot prices in mid-2020, emphasizing the price sensitivity of the nation's buying patterns.