A new wave of COVID-19 cases slowed down the growth of China’s LNG imports in July. According to customs data, China imported 5.03 million tons of LNG last month, increasing by 4% from 4.88 million tons a year earlier, slower than a year-on-year growth of 19% in May and 29.2 in June. Pipeline gas imports also fell by 23.2% to 2.31 million tons in July from 3.01 million tons in the same month last year, the data showed.
In July, resurging COVID-19 infections hit Chinese economic activity and industrial demand for LNG. Market participants said that factories were already operating at low rates due to weak international trade and exports, but the new infection wave forced them to cut operations even further. Apparent gas demand dropped 1.7% in that month due to lower gas and LNG imports.
Looking forward, the slowdown in domestic gas production may create some opportunities for Chinese importers. The National Energy Administration (NEA) forecast that China’s natural gas output would increase by 4.6% in 2020 from 2020, slower than a 9.6% increase during the first seven months of the year.
