Domestic LNG Market Review (June 8 – June 12, 2026)
Domestic LNG prices continued to move higher amid fluctuations. Tightening supply and rising production costs delivered strong upward momentum. However, sluggish off-season demand and low acceptance of high prices led to mixed price movements with limited gains, forming a typical tug-of-war between robust cost support and weak demand.
1. Price Trend: Routine of Rise – Correction – Rebound
Early week (Jun 8 – Jun 9): Prices climbed rapidly. The mainstream ex-plant price in Northwest China stood at 6,050–6,150 RMB per tonne, up 2%–3% week on week.
Mid-week (Jun 10 – Jun 11): Prices retreated from highs, with a drop of 50–100 RMB per tonne in some regions. Hebei and Shandong saw the most notable declines.
Late week (Jun 12): Prices rebounded again, with the average price returning to 6,100–6,150 RMB per tonne. The overall weekly increase reached 1.5%–2%.
2. Early-week Rally: Plant Maintenance & Gas Supply Restructuring Tighten Supply
2.1 Widespread maintenance drags down operating rates
June is a traditional maintenance season. A total of 71 LNG plants in Northwest, North and Southwest China suspended production or underwent maintenance, pushing the national operating rate down to merely 47%.Major plants across Shaanxi, Ningxia and Inner Mongolia took turns for maintenance. Regional daily output fell by 8%–10% week on week, resulting in a notable shortage of spot supply.
2.2 Adjustment of entrusted gas supply reshapes gas flow
Upstream suppliers prioritized gas delivery via pipelines, cutting the feedgas quotas for LNG plants. PetroChina’s gas supply via bidding slumped from 23 million cubic meters per day in January to 11.2 million cubic meters per day, a nearly 50% reduction.Entrusted gas supply services were suspended or scaled back in some areas. Faced with insufficient feedgas, plants firmly held prices and even implemented delivery restrictions.
2.3 Cost inversion reinforces strong price support
The average bidding price of feedgas in the first half of June was 3.795 RMB per cubic meter, translating to an LNG production cost of around 6,155 RMB per tonne — higher than prevailing ex-plant prices, leaving most plants in the red.Driven by cost pressures, plants adopted a strategy of maintaining low inventory while quoting firm prices. They raised prices actively on transactions and refused to sell at a discount.
3. Mid-week Correction: Weak Demand Restricts High-price Transactions
3.1 Muted off-season demand, transactions dominated by rigid demand
Industrial sector: Chemical, ceramic and glass producers operated at low capacity. Coal and oil gained greater substitution advantages, driving industrial direct-supply demand down 10%–15% year on year.
City gas utilities: Residential gas consumption remained stable. Utilities purchased gas only to meet immediate needs and kept inventory levels low, showing little willingness to stock up at high prices.
Vehicle fuel market: Road freight activity stayed sluggish. LNG lost its economic edge against diesel, leading to continuous declines in LNG refueling volume.
3.2 Regional divergence: Prices firm where sales are brisk, weak where sales lag
Prices held steady or edged up in Northwest China thanks to stable local demand and smooth outbound transportation.Located close to coastal terminals, Hebei and Shandong faced intensified competition from imported LNG. Downstream buyers resisted high prices, trading activity turned thin, and local prices dropped by 50–100 RMB per tonne.A stark divide emerged: suppliers with ample goods faced strong demand, while buyers in weak-demand regions remained cautious, widening regional price gaps.
4. Late-week Rebound: Higher Feedgas Bidding Prices Strengthen Cost Support
4.1 Sharp hike in feedgas bidding prices for late June
On June 12, feedgas was traded at 3.97–4.25 RMB per cubic meter, up 0.22–0.35 RMB per cubic meter from the first half of the month. The corresponding LNG production cost rose to 6,300–6,500 RMB per tonne.Total trading volume hit 150 million cubic meters with no unsold lots. Upstream suppliers showed clear intentions to prop up prices, further lifting cost pressures on LNG plants.
4.2 Improved market sentiment fuels bullish expectations
The new cost benchmark of 6,300 RMB per tonne became a solid support. LNG plants united to hold prices and made tentative hikes.Market participants expected feedgas costs to stay elevated and supply to remain tight in late June. Trading activity picked up over the weekend, pushing LNG prices higher again.
5. Imported LNG Market: High Landed Costs and Sluggish Deliveries
Internationally, the JKM spot price was quoted at 18–19 USD/MMBtu. Production capacity in Qatar recovered to only 50%, and industrial strikes persisted in Australia. The landed cost of imported LNG stood at 6,200–6,500 RMB per tonne, exceeding the cost of domestic LNG.Truck deliveries from coastal LNG terminals fell 5% week on week. Ex-terminal prices in a few areas ticked up slightly, exerting limited impact on inland markets.
6. Market Pattern and Core Game Dynamics
Bullish side (LNG plants): Plant maintenance and gas supply adjustments tightened supply; rising feedgas costs lifted production expenses; mounting losses compelled plants to defend prices aggressively.
Bearish side (downstream buyers): Off-season conditions depressed overall demand; high prices curbed purchasing enthusiasm; abundant alternative fuels weakened buyers’ bargaining power.
Overall, prices trended upward with limited gains. Every price rally was capped by weak demand, while every pullback was underpinned by high production costs.
7. Short-term Outlook (Mid-to-late June)
Supporting factors: Feedgas costs stayed above 6,300 RMB per tonne, plant maintenance continued, and international LNG prices remained high. Prices are tilted to the upside.
Restricting factors: Off-season demand is unlikely to improve notably, and high prices will continue to dampen trading. A sharp price surge is improbable.
Forecast: The average ex-plant price of domestic LNG will fluctuate within 6,100–6,400 RMB per tonne with a mild upward trend. A decisive break above 6,500 RMB per tonne will require additional catalysts, such as surging gas-fired power demand amid prolonged high temperatures or delayed arrivals of imported LNG cargoes.