Step aside the panic: Russian LNG will not be stopped buying even in Europe

Alexey Belogoryev, Deputy Principal Director on Energy Studies of the Institute for Energy and Finance, commented on the prospects for Russian LNG in the world market to the Expert magazine.

Alexey Belogoryev recalled that China is reducing LNG imports this year. The reduction itself is connected, according to him, with uncompetitive gas prices for energy and industry, relatively warm winters, tough lockdowns, an economic and political turn towards growth in coal production and consumption, and a planned increase in Russian gas supplies through the Power of Siberia Pipeline.

“In 2021, prices weren’t all that low either, but global demand was still up 4.5% y/y. For this reason, Russian LNG will definitely find its place in the world market. Unlike the oil and coal market, there is not even a potential replacement yet. If the developed countries reduce LNG imports from Russia for political reasons, it is very likely and even inevitable that its flows will be redirected to the developing countries of Asia, including China, from where other suppliers leave in search of easy and quick profit in the European market that has become “premium”, - Alexey Belogoryev concluded.