China Cuts LNG Imports as Cheap Domestic Gas Undercuts Global Prices

China is importing less liquefied natural gas despite the start of peak demand season, thanks to an abundant domestic gas supply that has led to lower prices. 97 per million British thermal units today, Bloomberg reported, almost $10 below the Japan/Korea Marker benchmark. The gas price drop comes as state-owned energy majors finish their gas stockpiling drive and begin to release gas from inventory, the report also said.

The sufficient domestic supply has made spot market LNG purchases unappetizing for Chinese buyers. China is one of the world’s largest buyers of liquefied natural gas and, as a consequence, one of the most price-sensitive buyers. Earlier this year, Chinese energy traders curbed their LNG imports when prices topped $20 per mmBtu, and the curbs extended into September as prices remained elevated.