A severe El Niño is poised to drive a warmer-than-usual winter across Asia, potentially curbing energy demand and offering some relief from the strains caused by the US-Iran war.
Major seasonal weather models are pointing to a broadly warm winter across Japan, South Korea and parts of China, along with Taiwan, Vietnam, Thailand and India. All of these countries rely on liquefied natural gas for part of their energy needs, but war has significantly curtailed supplies from the Middle East and pushed spot prices to the highest level since late 2022.
Japan and South Korea are expected to see average temperatures around 1C to 2C above normal from November through February, according to the European Centre for Medium-Range Weather Forecasts’ seasonal model. Warm deviations of as much as 2C higher than usual are also set to gradually encompass most of China, except the heavily populated eastern coast, by January.
The three countries are the top importers of LNG in Asia, and softer demand could free up cargoes for Europe, which needs additional supplies to bolster below-normal inventories ahead of winter. Above-normal temperatures could also reduce consumption of coal, which has seen a spike in demand and prices after the Middle East disruptions. Before the war, about a fifth of the world’s LNG was shipped through the Strait of Hormuz to global customers.
The outlook for Asia coincides with forecasts for a relatively warmer European winter, while swaths of the western, southern, and southeastern US are expected to be wetter and slightly colder than normal.
El Niño is a naturally occurring climate phenomenon that typically brings warm and dry conditions to Asia, curtailing rainfall and exacerbating wildfires. While the ECMWF and some other seasonal models are projecting a warmer winter in China and Japan, there are “hidden risks” within that outlook, said Christian Werner, managing director of Global Weather Climate Analytics.
“Embedded within this warm bias are short one- to two-week periods of average to below-average temperatures due to a more southerly excursion of the polar vortex,” he said. The vortex is a girdle of winds around the Arctic, which can weaken and dip south and allow frigid air to spill out, leading to cold snaps and higher demand for heating.
Even one major outbreak of frigid weather, particularly if it hits multiple continents simultaneously, would intensify competition for LNG and tighten global energy markets. A multi-model seasonal forecast is currently showing rising odds of a substantial weakening of the polar vortex from late January, which could increase the risk of cold snaps across East Asia in February, according to Atmospheric G2 meteorologist Takahisa Nishikawa.
“For now, I would highlight February as a period worth monitoring for potential cold risks, rather than suggesting that a major cold outbreak is already likely,” he said.
Still, Planette AI chief executive officer and founder Hansi Singh says a record-strength El Niño and the shifting of stratospheric winds around the North Pole lowers the probability of Arctic blasts in coming months. “This winter is kind of the inverse of last year’s, when we actually had pretty perfect conditions for cold blasts,” she added.
Disclaimer: This report is auto generated from the Bloomberg news service. ThePrint holds no responsibility for its content.
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