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LNG: US LNG Production Ramp-Up Could Ease LNG Competition: Platts

LNG
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A ramp-up of US LNG production may ease competition for cargoes between Europe and Asia, even as the market focuses on Asia’s summer procurement, Platts said.

  • Europe’s strong inventory withdrawals and reduced Russian gas supply will rely on LNG to refill stocks – forecast to end winter around 40%.
  • This could lead to heightened competition with Asia as Europe fills storage for next winter.
  • However, new US production from Plaquemines and Corpus Christi 3 could help meet Europe’s demand - their output should be significant by the end of 2025.
  • This optimism has helped flatten the backwardation structure in the LNG market, Platts said.
  • US LNG’s role in Asia will likely grow due to contracts with Asian importers and Trump’s shift in trade policy.
  • LNG could be a bargaining chip for Asian countries, which could incentivise US-Asia LNG flows, despite poor arbitrage economics.
  • China’s contracts with US LNG for 6.2m mtpa by 2026 and potential counter tariffs may upend trade flows.
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A ramp-up of US LNG production may ease competition for cargoes between Europe and Asia, even as the market focuses on Asia’s summer procurement, Platts said.

  • Europe’s strong inventory withdrawals and reduced Russian gas supply will rely on LNG to refill stocks – forecast to end winter around 40%.
  • This could lead to heightened competition with Asia as Europe fills storage for next winter.
  • However, new US production from Plaquemines and Corpus Christi 3 could help meet Europe’s demand - their output should be significant by the end of 2025.
  • This optimism has helped flatten the backwardation structure in the LNG market, Platts said.
  • US LNG’s role in Asia will likely grow due to contracts with Asian importers and Trump’s shift in trade policy.
  • LNG could be a bargaining chip for Asian countries, which could incentivise US-Asia LNG flows, despite poor arbitrage economics.
  • China’s contracts with US LNG for 6.2m mtpa by 2026 and potential counter tariffs may upend trade flows.