Cheniere Energy, the world’s biggest exporter of liquified natural gas (LNG), is warning that this winter, it is looking like supplies of LNG may be, “really, really tight.”
In a report by Reuters, Cheniere also said that as China reopens, there will be a surge of demand for LNG which will make the coming energy crisis even worse.
At a Gastech conference, Cheniere’s executive vice president for worldwide trading, Corey Grindal, said, “At the end of the day, what’s going to decide how tight the market will be is how cold it is and how government policies, industry rationing work.”
Grindal noted that due to the current price environment created by the European shortage, the majority of LNG supplies will continue to be routed to Europe where possible. He noted that prices there have skyrocketed from $2 per million British thermal units (MMBtu) in 2020 to $57 per MMBtu in August – a 2,750% increase.
The US has increased exports of LNG to Europe this year, as Russia has curbed supplies due to technical issues with the Nord Stream pipeline limiting flows. China has been also supplying Europe with its excess LNG, much of which it is purchasing at deep discounts from Russia, only to turn around and resell it to Europe at markups of 200%-300%.
The Daily Financial Trends
