Feb 9, 2023
China Scouts for LNG in Risk to Gas Market’s Delicate Balance
(Bloomberg) -- China is looking for shipments of liquefied natural gas into next summer, a move which could tighten global supply and steal shipments away from Europe.
State-owned China National Offshore Oil Corp. is looking to purchase LNG shipments from June 2023 to June 2024, according to traders with knowledge of the matter. Cnooc didn’t specify how many shipments it is seeking to buy, but noted that suppliers must offer at least one cargo for winter delivery, the traders said.
Cnooc’s move comes as China’s pivot away from Covid Zero is poised to boost natural gas demand in the world’s biggest importer. Traders are anticipating LNG purchases to increase.
China’s potential return to the market could curb the availability of the fuel for Europe, where supplies are expected to remain tight next winter. The Asian nation’s LNG imports slumped roughly 20% last year due to virus restrictions and high prices, freeing shipments to other markets.
Cnooc released a similar tender in December, resulting in the purchase of a handful of shipments for 2023 delivery. While the cargoes comprised only a fraction of the country’s total fuel demand, it was still one of China’s largest spot purchases in the past year.
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