Three Barrels Of Oil

Under the influence of various factors, natural gas has become a new "price rising leader" of bulk commodities. Under high prices, resources are still in short supply, and a global "rush for gas" is being staged.

Natural gas, once of high quality and low price, has recently become the focus of global attention. Under the background of the imbalance between supply and demand, the price of natural gas has risen to a historical high, which has become another focus in the rising tide of commodity prices.

High gas prices bring high costs, and the pressure of downstream enterprises is also increasing. With the advent of September, the traditional peak season of natural gas consumption is about to start. According to the current situation, all localities are seizing time to reserve natural gas resources for winter. It is difficult to significantly alleviate the global supply shortage in a short time.

Gas price soared several times

For this year's natural gas market, "price increase" is not news. However, the recent rise in natural gas and LNG prices has surprised all sectors.

In the past year, LNG prices in Asia have soared by nearly 600%; In July, the price of natural gas in Europe increased by more than 1000% compared with the lowest level in May last year. The price of natural gas futures in the United States has risen by more than 50% in the year, reaching its highest level in a decade in August.

March to August is the traditional off-season in China's natural gas market. Domestic and foreign market supply is relatively loose, and the price is relatively low. However, in recent two years, domestic natural gas consumption has grown rapidly, and the overall market presents the characteristics of "not weak in the off-season, more prosperous in the peak season". The incremental changes of pipeline gas and domestic gas are limited. Due to its clean and flexible supply characteristics, liquefied natural gas (LNG) effectively makes up for the market demand gap.

According to jinlianchuang price index, the average LNG price index in August was 5482 yuan / ton, up 24.7% month on month, 111.6% and 70% higher than last year and August of the previous year.

Since the end of 2020, the international gas price has rebounded from the bottom, and has risen steadily in the turbulence since then. Since this year, under the background of global easing, the general rise of commodity prices has caused resonance, driving the price of natural gas to continue to rise. However, the price of natural gas has been at a low level for a long time before. In addition, due to the impact of this year's epidemic situation and insufficient investment in upstream exploration and development, the current natural gas supply increment is limited and cannot effectively meet the rapid increase of current demand.

Under the comprehensive influence of various factors, the price of natural gas has increased significantly.

In terms of China's market, the promotion of the "double carbon" process and the continuous "coal to gas" project in recent years have led to the steady growth of domestic natural gas demand. In the global scope, natural gas, as a clean fossil energy, has gradually increased its proportion in the energy structure of many countries.

With the winter approaching in the north, from Europe to Asia, buyers from all over the world are actively raising resources to make reserves for winter demand. A "rush for gas" is being staged all over the country.

The pressure of downstream pressure increases sharply in winter

The fluctuation of China's LNG price in August was higher than that in July, with an overall upward trend; Import costs continue to rise and upstream policy to reduce losses is still the main driving force to push prices up, but the rise has shown signs of weakness.

The significant increase in gas prices has put pressure on the downstream related industries. Under the market resistance, LNG consumption has declined. According to jinlianchuang statistical data, China's LNG apparent consumption in August was 4.49 billion cubic meters, down 3.3% month on month and 16.3% year-on-year.

Sun Xuelian, an analyst at jinlianchuang Natural Gas Co., Ltd., said that the sales volume of LNG filling stations has dropped sharply in recent years, ranging from 30% to 70%. LNG heavy trucks in some regions have even been suspended, which also led to the decline of LNG heavy truck sales this year; However, higher gas prices have led to higher costs, and some small and medium-sized enterprises have reduced production or even stopped work.

This summer, affected by the continuous improvement of the economy and the high temperature weather, the domestic power demand increased steadily, the coal supply appeared to be relatively tight, and the price of steam coal also increased simultaneously. In order to ensure the power supply, in addition to reserve power coal resources, local power plants also put the hope of ensuring power supply to gas power plants. However, the high cost brought by the high price of natural gas has also deterred many enterprises.

Wang Ruiqi, senior analyst of jinlianchuang natural gas, pointed out in the 21st century economic report that the international spot price of LNG has been rising recently, and the supply of pipeline gas is also relatively tight, pushing the LNG market price to exceed 6000 yuan / ton; It has great influence on industrial users and gas stations using LNG as gas source.

For urban gas enterprises, especially those without pipeline gas, the rise of LNG price brings greater cost pressure to the operation of enterprises, which is relatively passive“ It is destined to be a relatively sad winter. " A person in the gas industry sighed.

Zheng Hongchen, President of ENN Natural Gas Co., Ltd., said that in view of the recent rise in LNG prices, the company has locked in low-cost gas sources by signing long-term contracts linked to oil prices, hedging, and cooperation with domestic unconventional natural gas suppliers.

Natural gas inventory in North Asia and Europe will be a key factor affecting the price of natural gas in winter.

Jeffrey Moore, S & P's Asia gas director, pointed out that due to the low inventory level in Europe, strong demand in Asia and South America, and insufficient supply increment in other regions except the United States, natural gas prices in Asia and Europe are expected to get strong support this winter.

Jinlianchuang analysis points out that the current overseas LNG price is still at a high level, and the possibility of high winter price cannot be ruled out; In case of cold weather, LNG supply will be very tight.

Bai Hua, senior economist at the natural gas Market Research Institute of CNPC Economic Research Institute, believes that in recent years, the impact of the spread of epidemic situation and extreme weather and other emergencies on the fluctuation of gas prices is increasingly intensified. In the next five years, the supply and demand of global natural gas market will be relaxed as a whole. However, due to the impact of LNG liquefaction project commissioning and project investment delay, the LNG market will face short-term supply and demand tightening, and the LNG spot price in Northeast Asia will remain at a medium high level.

After September, with the decrease of temperature and the coming of northern heating season, domestic natural gas demand will rise synchronously. For PetroChina, Sinopec and CNOOC, which are the main suppliers of domestic natural gas, they will start to ensure the supply of domestic natural gas by means of domestic production increase and supply guarantee, coordination of overseas LNG resources and onshore pipeline gas. This year, the pressure of "three barrels of oil" is still huge.

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