BAKU, Azerbaijan, Jan.11. Competition for long-term LNG supply contracts is expected to intensify as importers seek to minimize exposure to volatility in spot prices, Trend reports with reference to Fitch Solutions.
“Policy initiatives allowing third party access for private companies to use LNG regasification terminals in emerging LNG markets should help intensify competition for spot LNG cargoes as well. Emerging LNG markets in South and South East Asia will propel LNG imports while plans for small scale regasification capacity additions in some of the region's emerging markets are opening up smaller, incremental LNG market growth opportunities,” reads the latest report from Fitch Solutions.
The report reveals that Asia’s natural gas demand will continue to growing far outpacing production throughout the forecast period up to 2031, underpinning dependence on imported LNG or piped gas.
“While Mainland China and India are key drivers behind robust demand growth, several emerging markets - Indonesia, Thailand, Malaysia, Vietnam - are contributing to regional demand growth. China, Indonesia, Thailand, Malaysia alike are pursuing liberalisation of gas markets paving the way for private companies to directly compete with the state-owned companies, while such measures are helping to enhance supply and keep gas prices competitive. Asian LNG demand is set to grow strongly driven by Mainland China, which now has emerged as the world’s largest LNG market. Slowing demand for LNG in the region's key buyers Japan and South Korea may not dent the region’s appetite for LNG as China and India remain bright spots for LNG market with significant latent demand.”
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