The International Energy Forum (IEF) in a new report titled "Global LNG Market Security" prepared in collaboration with the Japan Organization for Metals and Energy Security (JOGMEC), explores the changing structure of global liquefied natural gas (LNG) markets and its implications for energy security, accessibility, and market resilience.
Forecast of LNG Trade Growth
This study shows that LNG trade may reach approximately 800 billion cubic meters (bcm) by 2031. However, supply concentration, infrastructure limitations, and maritime choke points impact the need for greater market resilience. Over the past two decades, LNG has transformed from a supplementary source to a strategic component of the global energy system, connecting producers and consumers in more diverse markets and providing greater flexibility compared to fixed pipeline infrastructures.
Global LNG trade has more than quadrupled since 2000, and it is projected to exceed 600 billion cubic meters by 2026. However, trade growth is sensitive to economic conditions, energy prices, infrastructure development, and policies.
Security and Infrastructure Challenges
The report notes that an increase in trade volume alone does not equate to enhanced energy security. LNG supply remains concentrated in a relatively small group of exporters, while critical infrastructure and transportation capacity require ongoing investment. Physical and virtual choke points significantly impact the security of the global LNG market and influence the speed of market responses to fluctuations and disruptions.
Jassim Al-Sharawi, Secretary General of IEF, stated, "LNG has moved from the margins of the gas market to the center of the global energy security agenda. Its share of global primary energy demand has nearly tripled, and global LNG trade has more than quadrupled during the same period." He emphasized that "the lessons learned from recent energy shocks are clear; the resilience of the LNG market is built through investment, additional capacity, diverse relationships, transparent markets, and ongoing dialogue between producers and consumers."
Harada Daisuke, General Manager of the Energy Business Unit at JOGMEC, also noted that "LNG is critically important for Japan's energy security and many other importing economies, while the market itself is becoming larger and more interconnected, exposing it to greater geopolitical risks and supply chain vulnerabilities." He also added, "This report highlights the value of combining in-depth market analysis with international dialogue, and strengthening LNG security requires a proper balance between sustainable long-term supply and greater flexibility."
The report also develops the first global LNG bilateral trade dataset, which includes 144 countries from 2000 to 2024, integrating various national and international statistical sources. This dataset provides a historical picture of LNG trade flows and forecasts up to 2031.
Investment across the entire LNG value chain is crucial. Future security depends not only on new liquefaction capacities but also includes upstream supply, storage, transportation, ports, regasification terminals, and the pipeline networks connected to them.
Ali Al-Samawi, Senior Energy Analyst at IEF and the lead author of this report, added, "We have gathered over two decades of bilateral LNG trade data from 144 countries, providing a clearer picture of how the global LNG market has evolved and its trajectory towards the future." He also emphasized, "The LNG market is becoming more globalized, but it is not less vulnerable. Demand is rapidly diversifying while supply remains concentrated, an imbalance that will shape the market's resilience to future disruptions."
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