China is pulling in ships from all over to avoid a natural gas supply squeeze ahead of another cold snap and as the world’s most populous nation prepares for Spring Festival celebrations.
Fuel demand in January and February typically slows as temperatures improve compared with the busiest month, December, but data suggest this year could buck the trend, Reuters reported. Another cold wave is about to hit North Asia, and Spring Festival, also known as Chinese or Lunar New Year, takes place later than usual this year in mid-February.
To ensure supplies before the longest holiday in the Chinese calendar, some 60 ships carrying more than 4 million tons of LNG are on their way to China this month, the third highest total behind December’s 5.1 million and November’s 4.36 million tons, according to shipping data in Thomson Reuters Eikon.
The shipments are coming from unusual origins—Equatorial Guinea and Angola in Africa, Peru in South America, and Trinidad and Tobago—and several are also coming from the United States. “The Chinese have bought loads of short-term delivery cargoes to meet an expected spike in demand,” the head of LNG trading at a major fuel merchant based in Singapore said.
Domestic producers are also churning out more gas. China’s December gas output was the highest since at least 2014, with state energy majors boosting operations at key gas fields like Changqing and Fuling.
With temperatures in capital Beijing set to drop as low as -15 Celsius this week, heating demand will soar and authorities want to avoid a repeat of December’s chaos, which saw serious supply shortages. Maintaining stability is a main priority of the Communist Party, particularly ahead of and during the Spring Festival.
