LNG in for wild ride until China builds storage
https://www.chron.com/business/energy/article/LNG-in-for-wild-ride-until-China-builds-storage-12701218.phpThe rollercoaster that drags liquefied natural gas prices higher as demand jumps in the northern hemisphere winter is going into overdrive.
After a winter in which an unexpected boost in demand from China pushed prices to three-year highs, spot LNG in northeast Asia has plummeted about 30 percent from its mid-January peak. Summer plunges and winter spikes are the order of the day, at least over two years, said Pablo Galante Escobar, head of LNG at Vitol Group, a commodities trading house active in LNG.
"Seasonality will be much more accentuated," Escobar said at the International Petroleum Week in London. "We'll have weak summers and strong winters, with China playing such a big role in the market."
China, which boosted LNG imports 46 percent last year as it turned to natural gas to combat pollution from coal, lacks the storage facilities that would help smoothen out the swings in prices between winter and summer. Rising global production paired with limited or falling demand in traditional summer markets might exacerbate those moves....
