LNG demand depressed into 2021

摘要

LNG is being hit by two competing storms: the demand destruction that we are beginning to see caused by the Covid-19 outbreak; and the softening demand that pre-dated the outbreak. Layered on top of this are very high storage levels in Europe and China, and a very mild winter across those regions. Last year there was a surplus of LNG, but storage space was available. Now there is depressed demand and storage levels are full. That means there are fewer places to park surplus LNG. While Chinese economic activity is picking up, it will take some time to recover because major consumer markets in the US and Europe are shut down amid the Covid-19 pandemic. LNG demand in Spain is expected to be down 10% in April and possibly more in May and Italy is even worse, down 23%.