Europe and China will compete for limited LNG volumes amid continuing market volatility in the near term, according to the Shell LNG Outlook 2023 report.
The report states the loss of Russian piped imports has ‘structurally altered’ Europe’s gas market and gas demand ‘destruction’ has heavily impacted Europe’s industrial sector, particularly the fertiliser market, but also chemicals, steel and cement.
European LNG imports soared 60% last year (up 45MT) to replace Russian gas although lower Chinese imports helped balance the global market. Global LNG trade hit 397m tonnes, a 16m tonnes increase on 2021.
“In the near term, the global LNG market is expected to remain tight and exposed to supply and demand shocks, with limited new supply coming online. More investment in supply will be needed to meet future LNG demand,” it states.
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