Media: China will stop LNG supplies to Europe for the sake of the domestic market

MOSCOW, 17 Oct — PRIME. The Chinese regulator ordered large state-owned companies to stop reselling liquefied natural gas (LNG) to buyers in Europe, as well as other Asian countries, in order to ensure the winter heating season in their country, Bloomberg reports citing sources.

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“The National Development and Reform Commission, the country’s main economic body, has ordered PetroChina Co, Sinopec and Cnooc Ltd. to keep winter cargo for domestic use,” sources told the agency, referring to LNG.

State-owned companies and the regulator did not comment on this information to Bloomberg.

China has large contracts to buy LNG from exporters like the US, and this year local traders diverted some of those supplies to Europe due to weak domestic demand, Bloomberg said.

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According to Bloomberg, such moves by China could lead to a reduction in the supply of liquefied natural gas to Europe and exacerbate the energy crisis there in the event of a cold winter.

However, the agency’s sources speculated that, on the other hand, while sales of LNG from China have brought some “relief” to European buyers, rapidly replenishing stocks and record high transportation costs have reduced the attractiveness of repeated deliveries of fuel.