According to a research report released by CICC, global LNG supply is set to contract in 1H26, with Asia serving as the primary demand adjustment lever. Global LNG exports in 1H26 reached 281.2 billion cubic meters, a decline of approximately 5.8 billion cubic meters compared to 1H25, with the roughly 10 billion cubic meters of incremental supply accumulated in January and February being fully absorbed between March and June. Looking at import volumes across major regions, Northeast Asia recorded the most notable import reductions, while European LNG imports remained relatively stable. The global LNG market is expected to maintain a tight balance in the short term, and upstream resource companies continue to offer attractive allocation value.

Short-term global LNG supply-demand dynamics remain tight, with winter gas price volatility risks rising significantly.

Global LNG exports in 1H26 declined by approximately 5.8 billion cubic meters year-on-year, primarily absorbed through reduced imports by Northeast Asia, while European imports held steady. According to CICC's calculations, if Qatari supply gradually recovers starting in October, global LNG supply in 2026 could still decline by approximately 16 billion cubic meters year-on-year. If full-year recovery fails to materialize, the reduction could expand to 26 billion cubic meters. Given China's limited room for further import cuts, notably diminished European demand elasticity, and low inventory levels, CICC projects JKM prices to fluctuate in the range of USD 15-25/MMBtu during autumn, with the winter average potentially rising to USD 25-35/MMBtu, and a risk of exceeding USD 40/MMBtu under extreme scenarios.

The medium-term trend toward supply loosening remains unchanged, but the LNG price base is likely to shift higher.

If Qatar returns to normal operations in 2027, coupled with the commissioning of U.S. projects under construction, CICC believes global LNG supply-demand dynamics could revert to loosening starting in 2H27. If the resumption of production continues to be delayed, the tight balance could extend into 1H28. Over the long term, CICC believes energy security considerations will drive North American LNG expansion, but rising U.S. liquefaction fees and natural gas costs could push the medium-term LNG price base upward from USD 8-10/MMBtu to USD 10-15/MMBtu.

China's natural gas demand faces near-term pressure, with growth expected to recover in the mid-to-late phase of the 15th Five-Year Plan period.

In 1H26, China's apparent natural gas consumption declined by 2.4% year-on-year. Under high gas prices, industrial and power-generation gas demand has faced substitution by coal and new energy sources, and CICC expects demand to remain weak during 2026-2027. During the 15th Five-Year Plan period, domestic natural gas production is expected to increase by approximately 5-6 billion cubic meters annually, a slower growth rate compared to the 14th Five-Year Plan period. As global LNG supply-demand dynamics loosen after 2028 and domestic pricing mechanisms further improve, China's natural gas demand growth is expected to return to mid-to-high single-digit levels. Additionally, CICC believes that during periods of high energy prices, alternative energy sources such as biomass will also gain certain structural development opportunities.

Risks include significant oil and gas price fluctuations, geopolitical conflicts escalating beyond expectations, new LNG capacity coming online faster than anticipated, and domestic natural gas demand recovery falling short of expectations.