U.S. LNG Exports Surge Despite 4Q25 Headwinds

Core Insights - U.S. LNG exports surged 24% to a record 14.6 Bcf/d in 2025, driven by new capacity and infrastructure projects, despite facing headwinds in 4Q25 due to tightening spreads between global LNG prices and U.S. benchmarks [1][2] U.S. LNG Capacity Expansion - 2025 marked a historic year for U.S. LNG, with exports reaching new highs and approximately 9 Bcf/d of new capacity beginning construction, including major projects from Venture Global, Woodside Energy, and Sempra Infrastructure [1] - LNG exports increased by 26% year-over-year, primarily due to the ramp-up of Venture Global's Plaquemines facility and the completion of Cheniere Energy's Corpus Christi Stage 3 [1] - An additional ~2.4 Bcf/d of capacity is expected to come online in 2026, driven by expansions from VG and Exxon [1] - The only Final Investment Decision (FID) in 4Q25 was for NextDecade's Rio Grande Train 5, while Energy Transfer suspended its Lake Charles LNG project [1] Global Market Headwinds - LNG-related stocks faced pressure in 4Q25, with liquefaction being the worst-performing subsector in the Alerian Midstream Energy Select Index [1] - The spread between European and Asian LNG markers and the U.S. Henry Hub benchmark compressed to multi-year lows of $4-$6 per million British thermal unit (MMBtu) by December [1] - Cheniere Energy, with over 90% of its production contracted long-term, remained insulated from spot price volatility, while Venture Global faced challenges due to its strategy of delaying commercial operations [1] - Cold weather forecasts and declining gas inventories in early 2026 have led to a rebound in global benchmarks, improving margins for LNG exporters [1] Potential Near-Term FIDs - Three LNG projects that were expected to reach FID by the end of 2025 have now pushed their targets into the first half of 2026, including Delfin FLNG, Commonwealth LNG, and Texas LNG [2] - Glenfarne signed a definitive sales and purchase agreement for its Texas LNG project, fully subscribing the project and targeting completion of financing and FID in early 2026 [2] Bottom Line - LNG export projects under construction are set to double U.S. export capacity by 2031, with more projects potentially starting construction soon [2] - While oversupply concerns impacted the market in 4Q25, fundamentals have shown improvement heading into 2026 [2]