Global LNG supply has grown 2% year-to-date

Global LNG supply has grown 2%, or 4 million tons, year-to-date, showing deceleration in the pace of growth, data from Mckinsey Energy Insights show. The US remains the largest contributor to market growth this year with around 8 million tons of additional LNG, although its average output in the past 3 months is similar to that of early 2019 with an average utilization level of 44%.

On the demand side, China and Europe increased imports year-to-date by 8 million tons, with China continuing to show monthly imports increasing to 6 million tons while European imports are still declining month-on-month to 5 million tons. The JKT region has reduced imports by 2 million tons (2%).

European gas flows

Year-to-date gas demand in Europe is down 12 bcm, or 4%, according to McKinsey. Demand in the last 3 months has increased by around 1 bcm compared to 2019. The main changes between 2020 and 2019 are linked to mild weather in January and lockdowns in April and May. Incremental gas for power demand in Germany of 2 bcm year-to-date offsets reductions in gas demand elsewhere in Europe.

Domestic supply production is down by 4 bcm year-to-date while pipeline entries to Europe have declined by 38 bcm, mostly from Russia. LNG withdrawals into the gas system are now up 6% year-to-date but momentum has dropped in the past 3 months with 8% lower withdrawals than in 2019. European storage levels continued to grow in August but are now 5% below the level seen in the same 2019 period.