The world’s LNG market will continue to be oversupplied into the mid-2020s as new supplies continue to outweigh demand, according to the International Energy Agency (IEA).
The IEA added that Chinese demand could tighten the market earlier than that.
“We will see massive amounts of new LNG capacity coming to the market … so we will probably continue to have well-supplied markets into the middle of the 2020s,” Keisuke Sadamori, director of energy markets and security at the IEA, said on Monday in Singapore, as quoted by Reuters.
According to the EIA’s October Short-Term Energy Outlook, the U.S. LNG export capacity is expected to rise in 2018, with LNG exports exceeding 3 billion cubic feet per day (Bcf/d) next year, 66 percent higher than this year.
The IEA, for its part, sees the U.S. challenging Qatar and Australia for global leadership among LNG exporters by 2022.
In addition, the world’s top LNG exporter currently—Qatar—plans to dramatically increase its gas production by 30 percent through 2024.
“The Qataris, for example, are going to increase LNG liquefaction capacity by 30 percent by 2024, which we have not included in our 2017 gas market outlook report,” the IEA’s Sadamori said on Monday.
China’s LNG imports are seen rising by 41 bcm annually by 2022, accounting for more than one-third of the growth among the countries seeking diversity in supplies. This will make China the second-largest LNG importer by 2022, the IEA said in its recent Global Gas Security Review 2017.
Last month, China’s LNG imports surged to their second-highest on record, as the country imports more gas to fight severe pollution and to service households in the north who will be using gas for heating this winter for the first time. China’s September LNG imports soared by 37 percent compared to September last year, to 3.45 million tons, according to data by the General Administration of Customs published on Monday and cited by Reuters. The volume was a bit lower than the all-time high of 3.7 million tons of LNG imports in December last year. Year to date, Chinese LNG imports soared 43 percent.