JP MORGAN CHASE(US:JPM)2025-11-07 01:28Summary of Global LNG Market Analysis Industry Overview - The global LNG market is entering a multi-year period of unprecedented supply expansion, with approximately 400 Bcm/year of new projects under construction and scheduled to come online between 2025 and 2035 [6][21][50] - The US leads the export project pipeline, accounting for 51% of total capacity under construction, followed by Qatar (17%), Canada/Mexico (10%), and the UAE (3%) [6][21][26] Demand Dynamics - Demand growth in key established LNG markets—China, Japan/South Korea, and Europe—is slowing [6][21] - China is expected to see LNG imports peak at 120 Bcm in 2032 [6][21] - Japan and South Korea are increasingly prioritizing nuclear and renewables, reducing reliance on imported LNG and coal, with projected growth of 15 Bcm in LNG imports between 2025 and 2035 [6][21] - European LNG imports are projected to grow moderately by 26 Bcm over the next decade [6][21] Emerging Markets - The onus to accommodate new LNG supply is shifting to emerging LNG markets in APAC (Taiwan, India, Thailand, Pakistan, Bangladesh, Indonesia), where demand is expected to more than double from 127 Bcm in 2025 to 280 Bcm by 2035 [6][21] - However, the APAC gas market faces significant challenges, including tightening regasification capacity and limited gas storage infrastructure [6][21] Infrastructure Needs - Upgrading demand-side infrastructure will be critical for global LNG demand growth to keep pace with the anticipated supply expansion [6][21] - The spread between US and global natural gas prices is expected to narrow, with the US emerging as the marginal supplier [6][21] Regional Insights North America - The US is projected to add approximately 26 Bcm/year of liquefaction capacity in 2026, with significant growth expected in 2028 and 2029 [31] - Canada is also expanding its LNG export capacity, with projects like LNG Canada and Coastal GasLink pipeline [32][33] Middle East - Qatar's LNG capacity increases represent the second-largest source of new supply after the US, with significant projects like North Field East and North Field South [34][38] Africa - Africa is the third-largest region for new LNG export capacity additions, led by Mozambique LNG and Nigeria [75][76] - Security concerns in Mozambique and operational challenges in Nigeria may hinder capacity utilization [80] Australia and the Pacific - Australia's LNG exports are expected to marginally increase in the near term but face long-term challenges due to resource constraints and regulatory risks [56][60] - Indonesia is undergoing a transformation in its natural gas sector, with new offshore discoveries expected to boost production [68] Conclusion - The global LNG market is poised for significant changes driven by supply expansions, shifting demand dynamics, and the need for infrastructure upgrades. Emerging markets in APAC will play a crucial role in absorbing new supply, while established markets face challenges in growth. The interplay between supply and demand will shape pricing and operational strategies in the coming years [6][21][50]