Asian LNG demand fell last year, EIA says

Slow economies and fuel substitution impacted the region’s LNG demand.

The three biggest customers for LNG saw annual consumption drop for the first time since 2009, according to the US Energy Information Administration (EIA).

The EIA said total LNG imports by Japan, South Korea, and China were 5% lower last year, declining 1 billion cubic feet per day compared to 2014, to an average 18.5 billion cubic feet per day.

The decline was blamed on reduced demand for electricity generation and the lower cost of rival fuels such as coal and fuel oil.

South Korea’s imports showed the largest decline, dropping 10% and the second annual decline for LNG imports. The decline was blamed on greater use of coal-fired and nuclear power plants.

Japan’s imports declined 4% last year mostly due to lower demand for gas-fired generation in the power sector. The EIA noted that overall power generation in Japan notched up its fifth year of declines due to the country’s weak economy. LNG consumption in power generation declined by 6% in 2015.

Japan saw greater use of thermal electricity generation, and greater use of nuclear power following the Fukushima disaster.

China’s LNG consumption dropped 1% in 2015, the first annual decline since LNG imports began in 2006, the EIA said. The decline in LNG imports was driven by a slowdown in the growth of the Chinese economy, lower prices of competing fuels, and higher pipeline imports.

Asia's LNG demand (bn cu.ft/day)
 20142015
Japan11.911.4
South Korea54.5
China2.62.6

 

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