Sectors

Regions

Sections

Forecasts & Analysis

Market commentary

Reference & Archive

LNG

China’s state LNG buyers feel pinch of higher oil prices

Higher oil prices have pushed up the cost of long-term LNG supplies for China’s state-backed importers just as the Chinese gas market gears up for its peak demand season Higher oil prices have pushed up the cost of long-term LNG supplies for China’s state-backed importers just as the Chinese gas market gears up for its peak demand season.
By Colin Shek 12 November 2018 0 33252
The Qingdao Sinopec’s Qingdao LNG terminal in Shandong province. (Sinopec)

China’s state-run LNG importers are counting the spiralling cost of their oil-indexed long-term contracts following this year’s sharp rise in crude prices.

Higher procurement costs for most of the existing sales-and-purchase agreements (SPAs) signed by PetroChina, China National Offshore Oil Corp. (CNOOC) and Sinopec in the past decade are putting pressure on the NOCs, Zhang Chunbao, general manager of the gas division at Sinopec’s trading arm, Unipec, said at the China International Oil and Gas Trade Congress in Shanghai on Friday.

Brent futures averaged $73.6 per barrel...