• 3 minutes Don't sneeze. Coronavirus is a threat to oil markets and global economies
  • 5 minutes Boris Johnson taken decision about 5G Huawei ban by delay (fait accompli method)
  • 9 minutes This Battery Uses Up CO2 to Create Energy
  • 12 minutes Shale Oil Fiasco
  • 2 hours Historian Slams Greta. I Don't See Her in Beijing or Delhi.
  • 18 hours We're freezing! Isn't it great? The carbon tax must be working!
  • 2 days Indonesia Stands Up to China. Will Japan Help?
  • 1 day US (provocations and tech containment) and Chinese ( restraint and long game) strategies in hegemony conflict
  • 15 mins Let’s take a Historical walk around the Rig
  • 17 hours Beijing Must Face Reality That Taiwan is Independent
  • 1 hour Tesla Will ‘Disappear’ Or ‘Lose 80%’ Of Its Value
  • 2 hours Trump has changed into a World Leader
  • 1 day Might be Time for NG Producers to Find New Career
  • 2 days Environmentalists demand oil and gas companies *IN THE USA AND CANADA* reduce emissions to address climate change
  • 2 days Anti-Macron Protesters Cut Power Lines, Oil Refineries Already Joined Transport Workers as France Anti-Macron Strikes Hit France Hard
  • 3 days Angela Merkel take notice. Russia cut off Belarus oil supply because they would not do as Russia demanded
Alt Text

Why Did Haftar Turn Libya’s Oil Off?

General Haftar is in the…

Alt Text

Oil Bears Are Back As Demand Fears Go Viral

Demand fears, largely driven by…

Matt Smith

Matt Smith

Taking a voyage across the world of energy with ClipperData’s Director of Commodity Research. Follow on Twitter @ClipperData, @mattvsmith01

More Info

Premium Content

China’s Natural Gas Consumption Soars

Chinese natural gas consumption surged through the first 11 months of 2017, up 19 percent year-on-year.

China is the third largest consumer of natural gas in the world, behind the U.S. and Russia, and is expected to show the strongest demand growth over the coming decades—propelling it to second place by 2040.   

As the nation's industrial and residential sectors pivot away from coal (think: smog), natural gas demand is going through the roof, with domestic Chinese LNG prices reaching a six-year high in recent weeks.  

One data point that highlights these tightening fundamentals is how CNOOC just rented a convoy of 100 trucks to transport LNG thousands of kilometers to northern regions in China to fill supply gaps. 

Driven by this recent rampant rise, China is now the second-largest importer of LNG globally. Spiking demand has lifted Northeast Asian spot LNG prices above $10/MMBtu.

(Click to enlarge)

Last year, China met 64 percent of its natural gas needs from domestic production. Even though projections suggest that domestic natural gas production will triple by 2040 (courtesy of the largest shale gas reserves in the world), around a third of its needs are met—and will continue to be—by pipeline flows and LNG imports.

(Click to enlarge)

As demand continues to rise, Chinese LNG imports have outpaced year-ago levels in every month of this year, as highlighted by ClipperData below. While demand is seen nearly 20 percent higher in 2017, LNG imports have jumped nearly 50 percent. LNG imports reached an outright record in November, at 4.5 million metric tons:  Related: Saudi Arabia’s Big Oil Gamble

(Click to enlarge)

Australia is the leading source of Chinese LNG imports, accounting for basically a half of receipts this year. Qatar, the world's leading LNG exporter (for now) is in second place, accounting for 20 percent of deliveries. Malaysia, Indonesia and Papua New Guinea round out the top five—accounting for 90 percent of all imports in 2017.

(Click to enlarge)

Perhaps the scariest thing about Chinese natural gas fundamentals is that the fuel only accounts for four percent of Chinese power generation capacity. Even though explosive growth in demand is expected over the next two decades, natural gas capacity is only expected to be seven percent of the generation mix by 2040.

(Click to enlarge)

By Matt Smith

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage




Leave a comment
  • Fred on December 21 2017 said:
    I think coal pollution will force natural gas to become 50% by 2040. U.S. LNG has a huge market potential even as China is developing a Silk Road project.

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play