As the world's largest buyer of liquefied natural gas (LNG), China has become an important global seller over the past decade. Decreased domestic demand and increased long-term contracts have positioned Chinese companies as serious competitors to traditional suppliers.
Decline in LNG Imports and Increased Surplus
China's LNG imports have decreased from a peak of 79 million tons (Mt) in 2021 to 66Mt in 2025, and this trend is expected to continue to 63Mt in 2026. Meanwhile, extensive contracts signed between 2021 and 2023 have led to a significant surplus of contracted volumes. Ship tracking data shows that resales by chartered Chinese vessels reached 8.4Mt in 2025. Estimates from the Institute for Energy Economics and Financial Analysis (IEEFA) suggest that China's LNG resales that year will be between 17Mt and 19Mt, with South Korea, Japan, and the Netherlands identified as the main destinations.
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Long-Term Contracts and Profitability
This trend has been reinforced by an increase in flexible long-term contracts, particularly from Australia and the United States. Flexible volumes from Australia to China allow the country to optimize its LNG portfolio in the Pacific region, while U.S. supply is primarily used to exploit arbitrage opportunities in the Atlantic region. IEEFA estimates that Chinese buyers have made $4.6 billion in profits from reselling Australian and American LNG since 2021.
With expectations of reaching 114Mt of LNG contracts by 2028 and demand constraints due to cheaper options, it appears that China will continue to have a surplus in the medium term. Independent demand forecasts indicate that an LNG surplus of between 11Mt and 48Mt may emerge by the early 2030s.
The recent expansion in LNG transportation and refueling by two state-owned companies — China National Offshore Oil Corporation (CNOOC) and PetroChina — reflects buyers' willingness to market surplus volumes. These two companies have heavily invested in LNG carrier fleets and are expanding refueling operations at major Chinese ports, using the Yangpu LNG terminal in Hainan as a transshipment and re-export hub.
China's emergence as a surplus LNG seller challenges vulnerable assumptions about the current wave of investment in LNG exports. For suppliers, portfolio traders, and LNG commercial players, the largest driver of LNG demand has become a competing supplier.
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