Chinese shiver as ‘artificial shortage’ of natural gas forces them to find other ways to heat homes
- Households are struggling, especially in rural areas where authorities did not ensure enough gas supply, and Beijing may have to step in ‘if things get worse’
- Analysts say solutions to China’s gas-supply woes ‘will be multifaceted, and most of them focus on the supply side’, including possibly securing more imports
People living in remote parts of China are finding it more difficult to escape frigid winter conditions due to an “artificial shortage” of natural gas, according to analysts, although the impact is expected to be temporary.
The blistering cold spell – with strong winds coupled with sub-zero temperatures – began on Thursday and is expected to last until Saturday, according to the National Meteorological Centre.
“The shortages are so far concentrated in lower-tier cities and rural areas across northern China,” said Alfredo Montufar-Helu, head of the China Centre for Economics and Business at The Conference Board. “But what’s currently happening is not really a supply shortage in the strict sense of the word. Rather, it is an artificial shortage.”
Montufar-Helu explained that the difference between wholesale and retail gas prices, as well as the “inability” of some local governments to subsidise the price differential, are the two key factors that have left some regions desperate for gas.