Page 7 - NorthAmOil Week 11 2021
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NorthAmOil COMMENTARY NorthAmOil
exports to Asia, after US-China LNG trade had What next?
dropped to almost nothing in 2019. In 2020, The EIA expects that US LNG exports will keep
US exports of the super-chilled fuel to China rising – as do others. The agency forecast in its
averaged 600mn cubic feet (17.0 mcm) per day latest monthly Short-Term Economic Outlook
– a considerable jump from only two cargoes that the country’s LNG exports would exceed
shipped over the whole of 2019. pipeline gas exports in the first quarter of this
There are hopes that US-China relations year, and for three out of four quarters in 2022.
will improve under new US President Joe It has reported, however, that US LNG exports
Biden, but others have warned that any thaw- dropped by 23% in February 2021 compared to
ing will be gradual. The two countries held January, to an average of 7.5 bcf (212.4 mcm)
their first high-level talks of Biden’s pres- per day, as a result of disruptions caused by the
idency this week, but were reported to be winter storm. The fact that LNG exports are still Exports to Asia
attending the meeting with a long list of griev- anticipated to exceed pipeline gas exports this
ances on both sides, and few expectations of quarter despite the storm-related outages once rose 67% year
resolving these quickly. again illustrates the fuel’s resilience. on year in 2020
Nonetheless, US supply and Chinese demand And despite the disruptions, US LNG pro-
are considered to be a good fit for each other, duction is set to expand further still as new according to
and the chances are, trade between the two trains start up at existing and future export
will continue to increase. Indeed, various US terminals alike. And on the demand side, inter- the EIA, and
LNG executives have voiced their confidence est in US LNG is predicted to keep rising, and
over this playing out, though they also tend to indeed appears have been bolstered by price accounted for
be keen to emphasise that they are not overly spikes in Asia over the winter. In the short term, almost half of
dependent on any single market. lower-than-normal European gas storage inven-
The EIA’s figures show that demand elsewhere tories are also anticipated to be a positive for US total exports.
in Asia also rose in 2020 – though not as sig- LNG.
nificantly. Exports of US LNG to Japan rose by Given the amount of disruption seen over the
200 mmcf (5.7 mcm) per day in 2020, which the past year – both pandemic-related and weath-
agency attributed primarily to seasonal winter er-related – the fact that US LNG exports have
demand in the fourth quarter of 2020. Ship- stayed so strong suggests a bright future for US
ments to India, meanwhile, grew by 100 mmcf liquefaction projects. And if future disruption
(2.8 mcm) per day last year, but this was mainly can be minimised their performance will be
linked to record low spot prices for LNG in the stronger still – though many of the outages are
spring and summer. out of exporters’ control.
Week 11 18•March•2021 www. NEWSBASE .com P7
