At a time when natural gas buyers are fighting over every last molecule, China, the world’s top importer — is noticeably quiet, says a media report.

In stark contrast to rivals across the region, China ’s liquefied natural gas importers aren’t procuring additional shipments for winter, gambling that the nation’s Covid Zero policy will continue to temper demand, say traders, according to Bloomberg report, which also points out that the  global supply crunch has made LNG very expensive, and traders don’t want to pay if the fuel won’t be needed.

It is a risky bet, the report notes and says it  could quickly backfire if the weather turns unusually cold or China ’s economy rebounds, upending a global gas market that’s already reeling from supply cuts from Russia and outages at key LNG export facilities.

A sudden rebound in Chinese demand for gas would force importers back into the cut throat competition to procure LNG, exacerbating a worldwide shortage and sending prices to stratospheric levels. The prices are already at a seasonal high.

It’s “an anomaly” for Chinese companies not to be buying LNG supplies on the spot market as winter purchases head into full swing, Toby Copson, global head of trading and advisory at Trident LNG, was quoted as saying. “It means China isn’t stressed about supply – what they have available via gas pipeline and their domestic coal production seems to be sufficient for the time being.”

 China became the world’s top LNG importer in 2021. Not this year,2022, though.

China ’s inactivity on LNG is providing opportunities for other buyers in Asia and Europe to shore up their gas inventories. Chinese firms are actually reselling spare LNG to energy-starved importers in Europe.

China has several options at its disposal to avoid expensive LNG shipments. The government is pushing miners to produce more coal, the main fuel for power generation, while also increasing cheaper pipeline gas imports and producing more at home. The nation’s coal output climbed to 2.2 billion tons in the first half of 2022, up 11% from a year earlier, the National Energy Administration said on July 22. 

A return of Chinese demand will increase competition from Asia for LNG cargoes, Goldman analysts said in a report. That will leave less supply for Europe and require the region to further cut consumption to ensure storage levels are “comfortable” ahead of winter, the report said.