Chilly Weather Sparks Global LNG Market Shifts
China and Europe are experiencing colder-than-usual temperatures this winter, causing a significant impact on the global liquefied natural gas (LNG) market.
China's Rising LNG Demand
Experts predict that China's demand for LNG could rise significantly due to the cold snap. Weather forecasts suggest that parts of China will experience temperatures 6 degrees Celsius lower than average, driving up LNG imports.
- November 2025 saw a rebound in imports, reaching 7.17 million tons.
- This trend is expected to continue into December.
In 2024, China saw a huge increase in both LNG and pipeline gas imports, aiming to fill storage facilities.
- First half of 2024: Natural gas imports rose by 14.3% compared to the previous year.
- Once storage facilities were full, imports started to decline.
Boosting Domestic Production
China has been working to boost its own natural gas production to reduce reliance on imported energy.
- November 2024: China produced 22.1 billion cubic meters of natural gas, a 7.1% increase from the previous year.
- Growth driven by faster-than-expected increases in shale gas production in the Sichuan Basin.
Despite these efforts, the increase in domestic production may not be enough to meet the surge in demand for heating during winter.
- Kpler expects China's total natural gas production to reach:
- 263 billion cubic meters in 2025
- 278.5 billion cubic meters in 2026
- Growth largely due to increased shale gas production in the Sichuan and Shanxi basins.
Europe's Impact on the LNG Market
The cold weather in Europe is also contributing to the tightening of the LNG spot market.
- As a major consumer of LNG, Europe's demand is likely to rise as well.
- This could lead to higher prices in the global market.
Summary
The cold weather in China and Europe is causing a significant impact on the LNG market.
- While China is working to increase its domestic production, it may not be enough to meet the seasonal demand for heating.
- This could lead to higher LNG imports and potentially higher prices in the global market.
