24 IEEFA. LNG exports have raised natural gas prices for U.S. households. November 2023. U.S. LNG sales contracts are among the least restrictive in the global industry: Buyers can ship and resell cargoes anywhere in the world. But this flexibility also means that buyers can cancel LNG cargoes when it is economical for them.
Will LNG prices fall below usd8/mmbtu?
IEEFA estimates that LNG prices would have to fall below USD8-USD9/MMBtu to compete with the cost of China’s pipeline gas imports and below USD6/MMBtu to compete with domestically produced gas. Until then, China will continue to have an economic incentive to favor pipeline gas imports over imported LNG. 166 Based on ICIS contract data.
How will global LNG production be impacted?
Although global LNG production capacity is slated to grow, total output will be constrained by operational challenges and declining feedstock gas production at many facilities. Roughly one-third of the world’s LNG plants have suffered from significant mechanical reliability and gas supply challenges in recent years.
