Rising European gas prices signal a test for US LNG exporters
Europe's gas market is hitting three-year highs, prompting a shift of US LNG cargoes from Asia to Europe and raising concerns for future demand.
Europe is confronting a sharp rise in natural-gas prices, the steepest in three years, as Qatar's liquefied natural gas exports stay close to rock-bottom levels. The shortage has revived the familiar pattern of global gas undersupply, with US LNG stepping in to fill the gap and Europe and Asia competing for limited cargoes. Until recently, Asian buyers secured a premium, but recent price gains in Europe have flipped the flow, sending more US tankers westward.
Goldman Sachs analysts warn that to retain a purchasing edge this winter, EU gas prices may need to be roughly 40% higher than today, more than double pre-war forecasts. While the EU has reduced its gas intensity through renewables and efficiency gains, the surge underscores a broader loss of trust in LNG among emerging markets, a concern highlighted by TotalEnergies CEO Patrick Pouyanné, and could push some Asian nations toward coal.
Why it matters
Higher European gas costs affect energy bills, industrial output and global LNG market stability.
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