The dynamics of global liquefied natural gas (LNG) supplies are pivoting back towards Asia following a decline in prices, triggering increased purchases from emerging economies, according to a Bloomberg report.
In March, shipments to Asia surged to approximately 24 million tonnes, marking a 12 per cent uptick compared to the previous year and setting a new record for the month, as per data from ship-tracking firm Kpler. Notable importers driving this growth include China, India, and Thailand.
The trend indicates that more LNG is expected to flow into Asia, diverting deliveries away from Europe, where inventories are currently at seasonal highs.
Asian LNG prices have remained close to their lowest levels in three years, primarily due to ample supply and mild winter conditions, rendering LNG cost-competitive with other fossil fuels. Consequently, swing buyers in emerging markets hurried to secure cargoes following a period of sluggish activity.
Meanwhile, European shipments in March dwindled by 20 per cent compared to the same period last year, hitting the lowest level since September, according to Kpler. Europe had ramped up its LNG purchases following the Russia/Ukraine conflict, aiming to lessen reliance on Russian pipeline gas.
China witnessed a 22 per cent surge in LNG imports in March compared to the previous year, while Indian shipments soared by nearly 30 per cent. Deliveries to Japan also experienced an 8 per cent increase, reversing a two-month decline.
The reduced LNG prices in both Asia and Europe are dissuading top importers in China and Japan from reselling shipments, with a preference to redirect deliveries to their domestic markets instead.
