Global LNG (liquefied natural gas) markets in the Northern Hemisphere are facing severe uncertainties this winter of 2026/27. LNG prices have risen above $30 per million BTU (MMBtu), and gas inventories in key markets have significantly decreased. This comes as price increases are not easily predictable, and there are substantial risks involved, including the revival of LNG supply in the Middle East and limited demand for heating and electricity due to weather conditions.
Situation in Europe and Asia
Europe has entered winter with the lowest gas inventory in a decade, and the lack of LNG supply from the Middle East in the Pacific basin has intensified competition for American cargoes. The continent must pay high costs to maintain the inter-basin arbitrage and hope for a mild winter to naturally limit demand. In Northeast Asia, heating and electricity demand is expected to be under pressure due to mild weather conditions. LNG prices above $30 per MMBtu have made gas usage more difficult and increased the use of coal.
Considerations in the United States and Beyond
The United States has remained detached from the trend of rising global prices due to strong production and healthy inventories. Henry Hub prices are expected to reach around $4 per MMBtu this winter. At the same time, specific weather conditions resulting from the El Niño phenomenon in the Central and Eastern Pacific will affect global weather patterns. This situation may impact overall gas demand but does not guarantee the prevention of cold spells and increases regional demand due to drought.
Challenges facing LNG supply from the Middle East and the uncertain situation in the Strait of Hormuz, which is the outlet for LNG from Qatar and the United Arab Emirates, are other factors to consider. In this context, Egypt is expected to have additional regasification capacity this winter and may need it.
Markets must plan for a wide range of outcomes and not just a baseline scenario.
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