China pipeline giant developing new gas price index for count

China’s state-owned pipeline giant is working to create the country’s own natural gas price index as the world’s biggest importer of the fuel seeks more influence on global costs.

China Oil & Gas Pipeline Network Corp. is currently developing the index, Yang An, deputy general manager of marketing at the firm better known as PipeChina, said at a conference in Beijing on Wednesday. Yang didn’t discuss when when the index might be launched or any other details about it, Bloomberg reports.

Chinese importers typically buy gas on long-term contracts tied to the cost of oil or via spot purchases indexed to Asia’s benchmark Japan Korea Marker liquefied natural gas price, which is published daily by S&P Global Platts. China wants a price index that better reflects changes in its own supply and demand, Yang said.

China has a long history of trying to use its purchasing heft to influence global commodity prices, to varying degrees of success. A much ballyhooed yuan-denominated oil futures contract launched in Shanghai in 2018 has yet to make major inroads on the market and usually just follows international benchmarks. Metals contracts in Shanghai may have more influence, but global traders by and large still follow benchmarks in London.