China’s natural gas imports hit record high in December as winter bites

Purchases rise 20 per cent from previous peak a month earlier to 7.89 million tonnes, customs agency says

PUBLISHED : Friday, 12 January, 2018, 12:41pm
UPDATED : Friday, 12 January, 2018, 9:11pm

China’s natural gas imports soared to a record high in December to battle a winter supply crunch, while crude oil imports eased sharply from November, according to customs data released on Friday.

December gas imports, including pipeline imports and tanker shipments of liquefied natural gas (LNG), came in at 7.89 million tonnes, 20 per cent above November’s previous record of 6.55 million tonnes, data from the General Administration of Customs showed.

Imports for the whole of 2017 jumped 27 per cent from 2016 to a record 68.57 million tonnes.

A massive government push to heat millions of homes and power thousands of factories with natural gas in northern China has led to demand for the fuel outpacing supply, while delivery infrastructure has found it hard to cope.

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“LNG imports last month reached new highs according to our cargo monitoring, and pipeline imports from Kazakhstan and Turkmenistan also ramped from previous month,” Diao Zhouwei, an analyst at IHS Markit, said.

Record imports by state energy firms and higher Chinese production have pushed down domestic wholesale LNG prices in north China. Prices were about 5,500 yuan (US$845) per tonne this week, down 45 per cent from peaks seen in late December.

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December’s crude oil imports hit 33.7 million tonnes, or about 7.94 million barrels per day (bpd). That compared to November’s 9.01 million bpd, the second-highest level on record.

Buying eased in December as refiners and fuel distributors drew on inventories after hefty stockpiling in the previous month, Seng-Yick Tee, an analyst with SIA Energy, said.

Imports throughout 2017 were up 10.1 per cent over the previous year at a record 419.6 million tonnes, or 8.39 million bpd, up 770,000 bpd, according to Reuters calculations.