Save for later Print Download Share LinkedIn Twitter Persistent sky-high LNG prices and new competition from Europe are prompting Asia to rethink the role of gas and LNG in its energy future. As the world’s fastest-growing LNG market, Asia had hoped to lean on LNG heavily to achieve carbon-neutrality goals, offset declining domestic production and complement renewables in power generation. But LNG's future role in Asia appears less secure today as policymakers and consumers respond to the current energy crisis. Soaring European gas prices have hoisted Asian spot LNG prices and led to demand destruction. Asian LNG demand was down nearly 8% in the first half of 2022, and weakness is expected to persist in the near term. China will likely record an annual decline in LNG demand this year due to high spot prices and Covid-19-induced economic slowdowns. China's attention has shifted to cheaper coal, domestic gas supplies and Russian pipeline gas. The crisis, meanwhile, has emboldened Japan and South Korea to push for a revival of nuclear power, while Southeast Asia is also studying its nuclear options.
