China's natural gas demand is expected to maintain momentum in the second half of 2023, bolstered by demand growth from downstream sectors, according to OilChem.
Domestic natural gas consumption in the first half rose 7.05% year on year to 194.95 billion cubic meters, due to the economic recovery after a full exit from COVID controls.
With the assistance of various policies aiming at boosting domestic demand and stabilizing the economy, the annual natural gas consumption is estimated to reach 387.3 billion cubic meters in 2023, an increase of 6.47% year on year, reversing the downtrend in 2022, data from OilChem showed.
With this in mind, China's natural gas consumption will reach 192.3 billion cubic meters in the second half, an increase of 10.6 billion cubic meters from a year ago.
Industrial use and power generation, sharing 36% and 22% of total natural gas consumption, will be the primary drivers of growth, with steel rolling, weaving and float glass demand expected to play an important part.
The rise in gas consumption for power generation is projected to stem from the growing number of gas-fired power plants and natural gas serving as a peak-shaving tool during the summer season. However, the civilization consumption (city-gas), with a share of 32%, will remain relatively stable, as it is more active in the heating sector in winter.
China Natural Gas Apparent Consumption
Source: OilChem
H2 2023 Natural Gas Demand Structure
Source: OilChem
Written by Sunny Fang, fss@oilchem.net
Edited by Aggie Hu, huchenying@mysteel.com