LINE

    Text:AAAPrint
    Business

    Trade tiff may hurt U.S. LNG exports, oil prices

    1
    2018-04-16 10:32:51China Daily Mo Hong'e ECNS App Download
    An employee shifts the LNG pipeline after filling the transport vehicle at the CNPC LNG center in Jiangsu province. (Photo for China Daily/Xu Congjun)

    An employee shifts the LNG pipeline after filling the transport vehicle at the CNPC LNG center in Jiangsu province. (Photo for China Daily/Xu Congjun)

    Liquefied natural gas or LNG exporters in the United States, which have been eyeing opportunities in China, might rue the current Sino-U.S. trade friction, said analysts.

    Demand for LNG in China has soared in recent years following accent on gas usage in place of coal and other polluting fuels.

    "We can't exclude the possibility that the U.S. may lose the opportunity to export more LNG to China if the trade war spreads from LPG to oil and LNG," said Wang Lu, an Asia-Pacific oil and gas analyst at Bloomberg Intelligence.

    Analysts also expressed concern that any escalation of tensions between the world's two biggest economies would have a negative impact on global oil prices.

    Bloomberg Intelligence expects that Chinese LNG imports may grow at compound annual growth rate of 17 percent from 2017 to 2020. Simply put, the rise in domestic production and pipeline imports are not enough to meet the soaring demand, necessitating more LNG imports.

    China has surpassed South Korea to become the world's second-largest LNG importer in 2017. China's imports grew 46 percent on the year in 2017 to 37.8 million mt, and are expected to reach nearly 49 million mt in 2018, Platts data showed.

    In the past few years, Beijing adopted many policies targeted at curbing coal output, reducing coal power generation, and promoting natural gas consumption, in order to increase the share of gas in the energy mix from the targeted 10 percent by 2020 to 15 percent by 2030.

    According to Wang, the U.S. was China's fifth-largest LNG supplier and exported 1.53 million tons of LNG to the country last year, which were from the spot market.

    Private companies such as Guanghui Energy and ENN Group have also joined State-owned CNOOC, PetroChina and Sinopec in the LNG receiving terminals business, increasing channels for spot LNG imports from the U.S., she said.

    BI estimates last year's LNG trade from U.S. to China was worth about $644 million, or 0.2 percent of the trade gap of $375 billion. While U.S. Commerce Secretary Wilbur Ross encourages China to import more LNG to reduce the deficit, the contribution would be marginal.

    According to Wang, though it can't close the gap, increasing exports of oil and LNG to China could reduce the U.S. trade deficit with China, albeit marginally.

    China proposed an extra 25 percent tariff on a list of U.S. products, such as soybean and pork, last week in response to the steep U.S. tariffs on $50 billion worth imports of Chinese products.

    S&P Global Platts estimated earlier China would account for 21.5 percent of U.S. LNG exports this year, putting China on track to potentially becoming the largest buyer of U.S. LNG this year.

    Besides LNG, there would be a risk for oil prices if China uses the bazooka option on U.S. crude oil exports, said Geneva-based consultancy Petromatrix. Bazooka option refers to a possible steep increase in Chinese tariffs on crude oil imports from the U.S., which could potentially penetrate several layers of the U.S. economy. China is the second-biggest importer after Canada of U.S. crude oil, to the tune of about 400,000 barrels per day.

    "If China were to impose counter tariffs on U.S. crude, it would become quickly very heavy for the U.S. supply and demand picture, resulting in U.S. crude oil price pressure that would have a negative impact on global oil prices," Petromatrix said in a report.

      

    Related news

    MorePhoto

    Most popular in 24h

    MoreTop news

    MoreVideo

    News
    Politics
    Business
    Society
    Culture
    Military
    Sci-tech
    Entertainment
    Sports
    Odd
    Features
    Biz
    Economy
    Travel
    Travel News
    Travel Types
    Events
    Food
    Hotel
    Bar & Club
    Architecture
    Gallery
    Photo
    CNS Photo
    Video
    Video
    Learning Chinese
    Learn About China
    Social Chinese
    Business Chinese
    Buzz Words
    Bilingual
    Resources
    ECNS Wire
    Special Coverage
    Infographics
    Voices
    LINE
    Back to top Links | About Us | Jobs | Contact Us | Privacy Policy
    Copyright ?1999-2018 Chinanews.com. All rights reserved.
    Reproduction in whole or in part without permission is prohibited.
    主站蜘蛛池模板: 巴彦县| 南昌市| 天柱县| 锡林郭勒盟| 绥江县| 武冈市| 包头市| 无棣县| 万山特区| 阳城县| 瑞金市| 渝中区| 正阳县| 晴隆县| 凤庆县| 雅江县| 乐至县| 中牟县| 勃利县| 义马市| 怀柔区| 敦煌市| 景洪市| 政和县| 台南县| 绿春县| 莒南县| 罗源县| 噶尔县| 鹤壁市| 金昌市| 临清市| 兰州市| 徐州市| 临高县| 达日县| 北川| 多伦县| 平湖市| 上饶县| 湖北省|