LNG supply potential is growing. Investments in the US market will stabilize the market [ANALYSIS]
Photo: Orlen
The blockage of LNG supplies from the Persian Gulf caused panic in the markets, and suppliers exploited the situation to speculate on price increases. Empty storage facilities after the winter did not guarantee a stable situation in countries dependent on seaborne gas supplies. However, it quickly became clear that the LNG market was not as dire as speculators portrayed. Shortages in supplies from the Persian Gulf were quickly filled by facilities launched in recent years.
In 2025, gas liquefaction and refueling systems were built, increasing production capacity by 30.1 million tons per year (Mtpa), according to the latest International Gas Union “IGU World LNG Report.” This increased global production capacity to 524.5 million tons per year by December 2025. The average global utilization rate of gas liquefaction facilities in 2025 was 83.9%. This is a slight decline from 86.5% in 2024. This was mainly due to extreme weather conditions, maintenance work, and mechanical failures, Kpler experts explain.
At the end of 2025, seven new LNG production projects received final investment decisions (FIDs), totaling 234.3 million tons per year (Mtpa). Kpler announces that approximately 37 million tons per year of new liquefaction capacity is scheduled to be commissioned in 2026.
The new projects are expected to be commissioned gradually throughout the year. This will translate into a steady increase in LNG supply and stabilization of the global market. The customer market is particularly focused on increased supplies from terminals located on the Atlantic side.
LNG demand change in 2025-2026 by region (Mt). Source: Kpler Insight
Kpler Insight forecasted in January of this year that global LNG supply would increase by over 46 million tons per year, reaching 475.3 million tons of annual deliveries in December 2026. However, given the delays in the construction of LNG facilities and networks to date, it is essential to closely monitor commissioning schedules and start-up profiles. The situation in the Persian Gulf has led many companies to accelerate work on increasing LNG production capacity.
Investment Acceleration
Laura Page of Kpler highlights two major projects scheduled to begin construction next year: the construction of the 15.6 million tons per year Golden Pass LNG facility in the US and the first 8 million tons per year unit of the expansion of Qatar’s North Field East (NFE). Following the US attack on Iran, the schedule for the latter project had to be adjusted. Delays caused by Iranian attacks on gas facilities are expected.
Golden Pass has experienced delays due to the bankruptcy of its original EPC contractor, Zachry. Construction of the Pluto LNG Phase 2 plant in Australia may also be delayed due to the possibility of a worker strike, Laura Page predicted.
The latest information indicates that the Pluto Phase 2 expansion, which is being carried out as part of the Scarborough Energy project, is over 96% complete, according to Woodside Energy. Woodside Energy’s Scarborough energy project is located 375 km off the Pilbara coast in Western Australia.
The Scarborough project, it emphasizes, “will provide thousands of jobs and ensure a reliable energy supply for Australia and the world. It will support the energy transition and help neighboring Asian countries in their efforts to reduce emissions.”
All 51 modules have been installed in Karratha, Western Australia. Woodside Energy is currently conducting commissioning, and the first delivery of liquefied natural gas (LNG) is planned for the second half of 2026.
The International Gas Union determined that “At the end of 2025, 1,105.4 Mtpa of planned liquefaction capacity was in the pre-FID stage.” The majority of the proposed capacity was in North America (650.3 Mtpa), including 384.4 Mtpa in the United States, 227.3 Mtpa in Canada, and 38.6 Mtpa in Mexico.
Russia (170.4 Mtpa), Africa (121.1 Mtpa), Asia-Pacific (67.0 Mtpa), and the Middle East (65.7 Mtpa) are also expanding their LNG production capacity. Approximately 31 Mtpa of liquefaction capacity is also being built in other countries and parts of the world.
New LNG facilities planned. Source: “IGU World LNG Report”
Leading suppliers expand capacity
The United States, Australia, and Qatar continue to rank in the top three in global operational liquefaction capacity. In the first half of 2026, Golden Pass, a joint venture between QatarEnergy and ExxonMobil, achieved first LNG production in March and exported its first cargo on April 22.
“Golden Pass LNG has successfully achieved its first production of liquefied natural gas (LNG) at Terminal 1 in Sabine Pass, Texas,” QatarEnergy announced, noting that “the $10 billion joint venture, involving QatarEnergy (70%) and ExxonMobil (30%), has transitioned to active export operations, successfully dispatching its first cargo.”
Despite the launch of Golden Pass deliveries, global LNG markets have only partially stabilized. The closure of the Strait of Hormuz and the unstable situation in the Middle East since early March have hampered LNG logistics.
The exclusion of Qatar2 and the United Arab Emirates (UAE) from the market has caused significant disruption, particularly in the Asia-Pacific market. QatarEnergy declared force majeure on numerous LNG contracts, which led to a short-term LNG shortage in the market.
Ongoing regional tensions will also have a long-term impact on the market, as the Iranian missile attacks of March 18th are likely to recur. They caused such severe damage to two LNG trains at the Ras Laffan LNG plant in Qatar that it will take months, or even years, to bring the systems back to optimal production.
Both plants are expected to be offline for the next three to five years, representing a loss of 17% (12.8 million tons per year) of Qatar’s total nominal production capacity during this time.
Gas Price Trends 2024-2026, Source: “IGU World LNG Report”
Qatar Halts Production
Bloomberg reported alarming news on July 10: “Qatar has suspended efforts to quickly resume production at the world’s largest liquefied natural gas (LNG) facility following an attack on an LNG carrier near the Strait of Hormuz.”
QatarEnergy representatives held a series of meetings following Tuesday’s attack, and CEO Saad Al-Kaabi decided to halt plans to increase production at the Ras Laffan complex, Bloomberg reported, citing people familiar with the decision. QatarEnergy decided that “For safety reasons, operations at the facility will be kept to a minimum, and the number of ships planned to berth at the terminal in the coming days will be reduced.”
This decision represents one of the most serious consequences for the energy sector of the renewed tensions around the Strait of Hormuz, following attacks on several ships near the strategic waterway and US attacks on Iran over the next two days, Anadolu Agency reports.
Trump Opens the Door for FIDs
Investor activity in LNG installations in 2025 was concentrated in the United States. The acceleration was due more to political support and regulatory relief than to increased demand, suggests the International Gas Union. FID activity increased following the Trump administration’s lifting of the ban on approving projects not covered by the Free Trade Agreement (FTA). This provision prevented the completion of many LNG projects before 2025.
This led to the launch of Woodside Louisiana LNG (16.5 million tons per year), Calcasieu Pass 2 (CP2) LNG (14.4 million tons per year), Port Arthur Phase 2 (13.0 million tons per year), Rio Grande Phase 2 (12 million tons per year), and Corpus Christi Midscale T8-9 (3.0 million tons per year) receiving FIDs last year.
CP2 LNG is currently under construction and is expected to be operational by the end of 2027, while the remaining four projects will be completed in 2029 or 2030. Australian company Woodside acquired the Louisiana LNG project from Tellurian in 2024, reviving it and receiving FIDs in early April.
Along with Louisiana LNG, CP2 is the only other greenfield project approved in the US in 2025. Venture Global acquired the FID for the project in July, increasing its operational and approved liquefaction capacity to 43.8 Mtpa, second only to Chenier’s 58.4 Mtpa, according to the IGU World LNG Report.
New LNG production capacity and launch year. Source: Kpler Insight
LNG investment under market pressure
Investor activity a few years ago was sparked by Russia’s attack on Ukraine and the dependence of many markets on Russian gas supplies. Severe sanctions on LNG imports from Russia proved impossible, and leading EU countries maintained imports at virtually unchanged levels.
The closure of the Strait of Hormuz and the blocking of supplies from the Persian Gulf caused a further shock. Importers received a clear signal of the need to diversify supplies. Meanwhile, producers mobilized to accelerate investments in export facilities.
“Looking ahead, the fundamental factors underlying long-term LNG demand forecasts until 2035 remain intact.” Population growth, urbanization, digitalization, growing electricity demand, and the ongoing drive for cleaner energy systems will require reliable and flexible energy solutions, which LNG is uniquely positioned to support, says Andrea Stegher, President of the International Gas Union (IGU).
According to the IGU President, “The challenges of 2026 are significant, but they do not change the long-term trajectory of the industry. On the contrary, they reinforce the importance of continued investment, innovation, and international cooperation to ensure that LNG continues to provide secure, affordable, and low-carbon energy to communities around the world.”
Energy security has become a priority for government energy policy more than ever before. Hence, in Poland, the expansion of the FSRU in Gdańsk and a significant increase in its degasification capacity. The premium on energy security will continue to drive supply-side investments in additional gas liquefaction facilities and the construction of export terminals.
This means that if the situation in the Persian Gulf and the Arabian Peninsula stabilizes, we can expect LNG supplies to stabilize at affordable prices within the next two years. Stabilization in the Arabian Peninsula region could open supply routes from the Persian Gulf to Europe via the Suez Canal. This will shorten the delivery route compared to LNG carriers from facilities located in the Arctic.
Stabilization of the situation in the Persian Gulf and the Red Sea will shorten the route of LNG deliveries to the EU and China compared to the routes of LNG carriers from LNG ports in the Arctic. Source: Kpler Insight