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Chinese imports of Russian

LNG hit 2.35mn tonnes

IMPORTS THE first half of 2022 has seen Chinese import- repeatedly announcing new supply records by
ers snap up 2.35mn tonnes of Russian LNG with way of the Power of Siberia pipeline.
a total value of $2.16bn. One statement released by the company
In a knock-on effect, this has seen Russia modestly announced “(C)urrently, Gazprom
move up China’s supply rankings, most notably carries out the gas supplies above the contractual
at the cost of the United States, with Washington daily volumes.”
seeings its own export numbers to Beijing nose- Sources indicate that Russian pipeline ship-
dive by 76%. ments to China have soared by well over 60% in
In moving up the rankings, Russia now stands the first six months of the year.
in fourth place on China’s largest-supplier list in Chinese customs data also indicates that the
the year to date, behind Australia, Qatar and value of all pipeline gas shipments has climbed
Malaysia. almost threefold y/y across the January-to-June
This comes at a cost for all other suppliers period, reaching $1.66bn.
to China, though. In similar form to the US, all As a result, a spokesperson for The General
other LNG suppliers to Beijing have seen export Administration of Customs (GAC) of China, Li
totals to China dip, albeit not by quite so much. Kuiwen, said that in order to “protect the legit-
Data from Chinese customs officials released imate business rights and interests of the rele-
earlier in the month now shows that import vant importers and exporters”, the agency no
totals for LNG have risen 28.7% year on year, longer releases breakdown data on pipeline gas
with recent price increases pushing the actual shipments.
value up by over 180%. The increases are not predicted to last forever,
Much of this increase has been brought though.
about as a direct cause of the Russian invasion of LNG demand across China is forecast to dip
Ukraine and spiralling costs for LNG worldwide. by around 20% by the end of the year, according
Dr. Michal Meidan, director of the China to some analysts, although UK-based research
Energy Programme at the Oxford Institute for and data firm Wood Mackenzie limits the poten-
Energy Studies (OIES), has, in part, attributed tial drop in LNG imports to 14%.
a reduction in demand in its Asian neighbours There is no end in sight for continued high
to China’s ability to expand its own purchases of prices, however.
Russian LNG. According to Jeffrey Moore, analytics
“The increase in Russian LNG could be a manager of Asian LNG at S&P Global Platts,
displacement of cargoes going to Japan or South “Because of Europe’s need to continue to source
Korea because of sanctions, or weaker demand significant volumes of LNG, prices are expected
there,” Meidan said. to stay elevated at levels which will reduce spot
US firms looking for larger profits on spot procurement in Asia, especially China.”
cargoes was another aspect of the drop-off in In part Chinese firms are working to coun-
US exports to China, according to Meidan. “US ter the expensive LNG prices of late, with Wood
LNG has been going to Europe because higher Mackenzie’s Miaoru Huang saying “Chinese
prices and demand there have made it more buyers have minimised their exposure to costly
attractive to ship it there,” she added. spot LNG.”
Russian natural gas piped to China has also “Spot purchases were muted, and reportedly
reached new highs of late, with statements from some Chinese players (also) resold cargoes into
the Saint Petersburg-based producer Gazprom the European market” Huang added.™

Week 30 29•July•2022 www. NEWSBASE .com P7