Liquefied natural gas is the stand-out story of the post-Covid commodities boom. Asian spot prices are soaring amid firm demand in China and Europe, but marshalling investment into newbuild gas liquefaction projects is proving tough. US LNG developer Tellurian has all but abandoned a strategy to lure buyers into investing equity in its flagship project in Louisiana, and is now pre-selling the fuel to commodities traders instead. Taking the fuel is clearly seen as less risky than owning a big piece of new fossil infrastructure with a 20+ year lifespan.
LNG demand proved to be impervious to the coronavirus crisis that crashed the oil market in 2020. Global LNG trade rose modestly last year to 356 million tonnes (mt) despite Covid-19 lockdowns and travel bans, driving Asian spot prices as high as $20/MMBtu in January. China imported a record 7 mt in May amid strong domestic industrial demand, driving spot prices to a four-month high last week …
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