China's Top Economic Planner Urges Gas Providers to Boost Output and Imports Amid Shortage

Strategic Insights -

Beijing, China is facing a severe gas shortage due to an unusual cold wave in the north, prompting China's top economic planner, the National Development and Reform Commission (NDRC), to issue a notice urging major gas providers to maintain high output and seek imports. Despite efforts to boost gas supply, the commission warns that it will be challenging to ease the shortage in the short term. Residential gas demand must be prioritized, followed by industry demand. The NDRC has singled out China National Petroleum Corp., China Petrochemical Corp., and China National Offshore Oil Corp. to take immediate action.

Key Takeaways:

  • China's top economic planner, the NDRC, has issued an urgent notice to three major gas providers to boost production and seek imports to ease the gas shortage.
  • The notice highlights the difficulties in fundamentally easing the shortage in the short term, despite previous efforts to boost gas supply.
  • Residential gas demand must be prioritized, followed by industry demand when supply is tight.
  • China's top oil and gas producer, CNPC, reported a 56% surge in natural gas consumption in northern China this month compared to the same period last year due to the cold weather.
  • Natural gas consumption in Hunan and Hubei provinces rose 22% from a year earlier.
  • Many large cities, including Wuhan, Chongqing, Xi'an, Nanjing, and Hangzhou, are suffering from gas shortages.
  • China's natural gas output rose 8% in the first 10 months this year from a year earlier, according to the commission.

Statistics:

  • China's natural gas consumption in northern China surged 56% this month compared to the same period last year.
  • Natural gas consumption in Hunan and Hubei provinces rose 22% from a year earlier.
  • China's natural gas production rose 8% in the first 10 months this year from a year earlier.
  • The notice was issued to China National Petroleum Corp., China Petrochemical Corp., and China National Offshore Oil Corp.

Sources:

  • Asia Pulse
  • XIC

November 26, 2022