Russia’s near-record LNG shipments show world’s struggle to cut reliance

Russian liquefied natural gas shipments increased in October to nearly a record, illustrating how the world is struggling to curb its dependence on the major supplier ahead of winter.

LNG exports from Russia rose 1.1% year on year in October to the highest level since March, according to ship-tracking data compiled by Bloomberg since 2016. That is in stark contrast to plummeting pipeline flows to Europe following the deterioration of relations between the West and the Kremlin over its invasion of Ukraine in February.

While almost half of the shipborne gas is still in transit, the top importing nations were France, China and Japan, the data showed. There currently aren’t any direct sanctions on Russian LNG, but the rise in exports shows how there is still strong demand for the fuel in preparation for winter, when cold weather is expected to boost consumption and tighten global supply.

Some utilities and governments are moving to halt additional purchases or stop deliveries from Russia altogether. The UK hasn’t imported the super-chilled fuel from Russia since the war started in February, and will formally ban it from January. 

Meanwhile, buyers in China increased purchases of Russian LNG to take advantage of a discount to the spot market, according to traders.