Goldman warns of a possible increase in the price of Asia LNG

If the supply of gas in Europe tightens this winter, liquefied natural gas prices in Asia might rise to more than $20 per million British thermal units (mmBtu), according to Goldman Sachs report. According to Goldman Sachs, Europe and Asia will have less access to LNG next year than anticipated due to delays in the forthcoming LNG supply projects around the Americas. After the existing transit agreement expires at the end of the year, residual Russian gas flows through Ukraine are also expected to cease.

Given that Asia produces more than 30% of the world’s LNG yet uses more than 60% of it, this is significant for the LNG markets in Asia. Shipments of the chilled fuel are expected to reach a record high of over 80 million metric tons this year in China, the largest LNG importer in the world, while Goldman Sachs predicts that year-on-year growth in 2025 will not be as robust as it is this year. This is because future economic development will be more normalized and because base gas consumption will rise.

Compared to a record 78.89 million tons in 2021, China imported 63.5 million tons of LNG in the first 10 months of this year, according to customs data. Russian piped gas shipments to China will expand more slowly as a result of the Power of Siberia gas pipeline shortly reaching capacity due to increased use.