China LNG buyers test spot market as cold weather raises domestic prices

Chinese LNG importers are cautiously testing spot markets for winter supply after a prolonged absence, as an early cold snap has pushed up domestic trucked LNG prices to two-and-a-half-month highs, with weather forecasts pointing to a potentially harsh La Niña winter, according to trade sources and industry data.

Temperatures in Beijing dropped below freezing on Oct. 20, weeks ahead of the seasonal average, prompting cold wave alerts and concerns about a prolonged chill, according to state-owned China Daily.

Multiple market sources noted some plants have idled due to the suspension of feedstock pipeline gas supply, as state-owned suppliers prioritized heating demand over industry use. As of Oct. 23, domestic LNG plants were estimated to be running at about 51% operating rate, according to LNG 168.com.

Trucked LNG prices in the Beijing-Tianjin-Hebei and northwest regions were assessed at Yuan 4,320/mt and Yuan 4,080/mt, respectively, on Oct. 23, up Yuan 360-370/mt, or 9%-10%, from a week ago, according to Haoqi Net, a subsidiary of ENN Group. In South China, trucked LNG prices have reached Yuan 4,500/mt, while West China offers rose to at least Yuan 4,200/mt on Oct. 24, up Yuan 400/mt from the lowest level in September, a domestic trader said.

"The domestic market [has been] quite active in the past few days. The recovery is relatively earlier this year," a Shenzhen-based trade source said. "Now buyers have to rely on existing volume for any incremental demand."

Cautious inquiries

The sharp domestic price rise has renewed some Chinese importers' interest in spot LNG, according to trade sources. A national oil company is seeking cargoes for December delivery, and second-tier buyers are checking prices.

"Some preliminary interest emerged among second-tier buyers. However, I don't think there's any additional demand," a Singapore-based source said, suggesting the purchases might be for operational optimization rather than new demand.

Platts, part of S&P Global Energy, assessed the Northeast Asia spot LNG price at $11.397/MMBtu on Oct. 23, up $0.273/MMBtu week over week.

However, outright buying has not been observed in the Asian spot LNG market.

"Some second-tier buyers may be seeking supply by truck rather than importing spot cargoes themselves, as the cost of importing cargoes is still high," a Guangdong-based source said.

"No significant changes in fundamentals in China. Some buyers might just be speculating on truck demand, which is getting stronger as winter approaches," another Singapore-based trader said. The spot interest remains selective.

"Still doubt if importers will be interested after the domestic hike," said a Shandong-based trade source, highlighting that pipeline gas remains competitive with term LNG contracts.

Oversupply

Despite winter concerns, China's gas market remains generally oversupplied. Apparent gas consumption slipped 0.1% year over year in the first eight months of 2025 to 284.56 Bcm, National Development and Reform Commission data showed, Platts reported Oct. 13.

Domestic natural gas output rose 6.4% year over year in the first nine months to 194.9 Bcm, while pipeline gas imports increased 8.2% to 45.42 million mt, according to the National Bureau of Statistics and General Administration of Customs, Platts reported Oct. 21.

China's LNG imports fell 16.7% year over year to 47.44 million mt in January-September, as buyers leaned on cheaper pipeline gas and long-term LNG contracts, Platts reported earlier.

"Looking at LNG consumption alone, demand is still weak, but overall gas consumption should be higher due to heating, industrial demand," a China-based source said.

"The imports after considering tolling fee should be around Yuan 4,500/mt, or slightly lower," the Shenzhen trade source added, suggesting imported LNG would need to compete with domestic supplies at these levels.

Winter uncertainty

The key variable remains winter weather. The US Climate Prediction Center on Oct. 9 forecast La Niña conditions are present and favored to persist through December 2025-February 2026, which typically brings colder temperatures.

"There may be some backwardation for first-half and second-half December now," the Beijing source said, referring to the market structure where earlier-dated contracts trade at a premium to later ones. "We need to see how the weather will be next week."

Most market participants expect Chinese spot buying to remain tactical rather than structural. Even with La Niña, China's extensive pipeline network, including the Russia-China Eastern Route operating at full capacity of 38 Bcm/year, provides a substantial buffer against supply shortages.

As one Singapore-based trader summarized, "There's some additional interest from Chinese buyers as weather gets colder, but not sure if this will sustain."