China bans exports of liquefied natural gas, reports Bloomberg

17 October 2022, 07:21 PM
Xi Jinping (Photo:Carlos Garcia Rawlins/Reuters)

Xi Jinping (Photo:Carlos Garcia Rawlins/Reuters)

Chinese authorities have instructed state-owned LNG importers to cut off supplies to Europe and Asia to ensure supplies for the domestic market during the heating sea-son, the Bloomberg financial news agency reported on Oct. 17.

Bloomberg sources told the publication that PetroChina Co, Sinopec, and Cnooc Ltd were approached by the National Development and Reform Commission, China's main economic planning body. China did not officially comment on the news.

"The sales provided some relief to European buyers, but rapid restocking and record high shipping costs have also reduced the appeal of new fuel deliveries," Bloomberg sources said.

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China's move to secure its own supplies could cut supplies to Europe and exacerbate the region's energy crisis in the event of a cold winter, Bloomberg noted. China has large contracts to buy LNG from the US, with traders diverting some of the supply to Europe due to sluggish domestic demand.

In 2021, China overtook Japan to become the world's largest LNG importer.

Reports are stating that gas prices in Europe have fallen to the lowest level since the end of June, and storage facilities are almost 92% full.

European LNG terminals are operating at around 63% capacity in October. In September and August, the figure was 59%. LNG imports in October may reach 11.5 billion cubic meters, which is one of the highest amounts in history.

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