Liquefied natural gas price falls 14% in a row before meeting the “rising tide”

Price trend

China’s liquefied natural gas fell for 12 consecutive days from November 2, stopped falling and rising on November 14, and ushered in a new round of price rise. According to the data monitoring of business agency: on November 1, the average price of LNG was 4750 yuan / ton, and on November 13, the average price was 4046.67 yuan / ton. The LNG price dropped 14.81% for several days, while on November 14, the LNG price rebounded, the average price was 4090 yuan / ton, 1.07% higher than the previous day, and 8.35% lower than the same period last year.


At present, LNG price rebounds


Product: according to the data monitoring of business agency, as of November 14, the LNG price of Inner Mongolia Erdos Star Energy Co., Ltd. is 4100 yuan / ton, and the LNG price of Inner Mongolia etokeqian banner Shitai Natural Gas Co., Ltd. is 4020 yuan / ton. The LNG price of Xinjiang Qinghua Energy Group Co., Ltd. is 4000 yuan / ton, that of Zizhou LNG plant of Shaanxi Lvyuan Natural Gas Co., Ltd. is 4100 yuan / ton, that of Xinjiang guanghuinaomao Lake (east of Lanzhou) is 2900 yuan / ton, that of Shanxi Qinshui Xinao is 3850 yuan / ton, that of Dazhou Huixin energy is 3700 yuan / ton, and that of Shaanxi Zhongyuan lvneng Natural Gas Co., Ltd At 4150 yuan / ton, liquid prices began to stop rising.


LNG goes up again when heating season comes


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In recent days, the cold air hit, LNG market also ushered in a turnaround. On November 15, central heating in northern cities officially started, and LNG prices in some northern areas began to rise in advance. Mainly due to the continuous decline of LNG price in the early stage and frequent cost inversion of the enterprise, the upstream enterprises have a high sentiment in view of the loss. With the rapid decline of LNG market in the early stage, it is possible for the market to store and copy the bottom, the shipment will gradually improve, the liquid level will gradually decrease, and the confidence of the operators will increase. On November 14, the bidding for Northwest LNG direct supply plant of CNPC began, with a total volume of 120 million cubic meters of natural gas, among which the first transaction price of 80 million cubic meters of natural gas was 2.2-2.25 yuan / square, and the second transaction price of 40 million cubic meters of natural gas was 2.38 yuan / square, with a maximum price limit of 2.38 yuan / square, slightly lower than the previous round of bidding. The northwest feed gas auction has been greatly adjusted, and the maximum price of the auction has been limited, which plays a great role in stabilizing the LNG market and alleviating the contradiction of heating season increase. In terms of the terminal, affected by the 6-day suspension of loading of 15-20 of Rudong LNG terminal, the shipment of the surrounding terminal is smooth, which also drives the price of the surrounding LNG market up.


As the weather turns cool, Beijing, Tianjin and Hebei have issued heavy pollution weather warning for many times. At present, the environmental protection requirements are relatively strict. We have actively built a clean, low-carbon, safe and efficient modern energy system, and made every effort to promote the consumption of clean energy. The pressure of environmental protection, “coal to gas” has stimulated the rapid growth of natural gas demand. However, LNG prices are too low this year, coupled with cost problems, manufacturers are willing to support the market. However, due to the impact of low-cost imported LNG and bidding factors, there is limited space for rising.


Domestic full response to natural gas demand


Since this year, China has made solid progress in the construction of natural gas production, supply, storage and marketing system. The policy of “coal is suitable for coal, gas is suitable for gas” also pays more attention to resource coordination, and people’s livelihood gas can be effectively guaranteed. “Three barrels of oil” actively increased storage and production, fully prepared for the heating season, and imported LNG began to play a role of supply guarantee. The natural gas pipeline of China Russia east line was put into operation in early December, which can increase new resource supply; in terms of transportation, it also vigorously promoted the interconnection of pipeline networks, effectively increasing the gas supply capacity of “south to North” and “northeast to customs” channels. It is estimated that the annual domestic production of natural gas will be over 170 billion cubic meters, with an increase of more than 11 billion cubic meters. As of this year’s heating season, the country is expected to build a gas storage capacity of nearly 20 billion cubic meters.


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Industry: according to the price monitoring of the business agency, there are seven commodities in the list of commodity prices rising and falling on November 14, 2019, among which the top three commodities are liquefied natural gas (1.07%), MTBE (0.62%) and WTI crude oil (0.56%) There are two kinds of commodities with a decline in the month on month ratio, the first two products with a decline are dimethyl ether (- 1.39%) and methanol (- 0.96%) The average rise and fall of this day was 0.05%.


III. future forecast


According to the LNG analyst of business association, with the rapid drop of temperature in recent days and the arrival of central heating in the north, the heating demand will increase accordingly. In addition, factors such as bidding will benefit the LNG market. LNG is expected to rise in the future.

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