The LNG market faces a dual shock of sluggish post-Hormuz logistics recovery and a strong El Niño driving higher consumption. This combination is expected to maintain structural tightness in global gas markets well into 2026.
Key Takeaways
- 1.The reopening of the Strait of Hormuz does not mean immediate supply normalisation, as LNG shipping remains constrained by risk sensitivity.
- 2.A strengthening El Niño is expected to significantly increase demand for LNG in Asia due to higher cooling needs and lower hydroelectric output.
- 3.Global gas markets remain structurally tight, leaving Europe vulnerable to lower-than-desired storage levels ahead of the winter heating season.
Table of Contents
- LNG supply shock gives way to weather-driven tightness
- El Niño emerging as the key market driver
- Reassessing the LNG balance
- Regional implications
- Europe
- Asia
- LNG exporters
- From supply security to climate security
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Authors
Daniel HynesSoni Kumari
Securities
LNG
Themes
El Niño Climate ImpactLNG Logistics DisruptionStructural Gas Market Tightness
Regions
GlobalAsia PacificEuropeUnited StatesIranQatar