Since 2012, LNG demand has risen each year. LNG demand is expected to register a slight annual increase. Volumes in 2020 projected to be up 4.4 million tonnes year-on-year, IHS Markit said.
Pipeline supplies were down in Q1 and LNG had already seen record volumes. As buyers are choosing to receive less pipeline gas as allowed by their contracts, this trend away from pipeline supply will persist.
From 327 bcm, gas demand in Mainland China for 2020 has been downgraded to 312 bcm. The northeast can get supplied more competitively by Russian pipeline supplies from the north through the Power of Siberia pipeline. As planned, the supplies still expected to ramp up.
The cargoes to Brazil and Argentina are potentially boosted by low LNG prices and lower hydro reservoirs in Latin America. With low LNG prices, prices of Bolivian pipeline will struggle to compete. Specifically in Brazil, newly inaugurated regasification capacity and reduced imports of Bolivian gas in the Northern region open space for increased LNG volumes. LNG imports have been substantially reduced in Mexico, owing to fierce competition from US gas flowing through new pipelines.
