China Halts Resales Of Russian LNG To European Buyers

China’s National Development and Reform Commission (NDRC), the country’s top planning body, told the country’s state-held LNG importers including Sinopec, PetroChina, and CNOOC, that they should stop reselling LNG cargoes and keep them to ensure Chinese gas supply this winter, Oilprice reported citing Bloomberg sources.

In recent months, as we reported first in August, Chinese LNG importers have been selling their excess inventories to Europe and reaping substantial profits from the sales because of lackluster demand in China. Chinese domestic demand has been squashed by rolling waves of city-wide Covid lockdowns and a slowdown in economic growth.

As a result, Chinese sales of LNG have been a relief to the European market so far this year. But as China now moves to cater to its own energy security this winter, Europe’s precarious LNG supply – much of which was a function of continued Chinese reselling of embargoed Russian gas – could dwindle just ahead of the winter heating season.

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