Reuters is reporting that an executive from Japan’s Inpex Corp. is predicting oversupply in the LNG market until mid-2020, at which point they expect demand from southeast Asia and India to pick up.
Asian LNG spot prices are currently at record lows due to the persisting trade war between China and the US, in addition to warm weather over the winter season. These factors, as well as the growing concerns regarding the impact of the coronavirus on China’s industrial demand (which reportedly accounts for 60 – 70% of total LNG consumption in China), have all contributed to creating oversupply in the region.
Commenting on the situation, Hitoshi Okawa, Inpex’s Australia chief, noted that while the oversupply situation is ongoing, economic growth in China, India and Asia Pacific as a whole is also ongoing, and therefore will inevitably generate new energy requirements. Hence, his prediction that demand will pick up again midway through the year.
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/05022020/lng-will-be-oversupplied-until-mid-2020/