The global natural gas market has undergone a complete cycle from 2020 to 2024, with 2025 presenting a structurally tight balance. Starting in 2026, the world will enter an LNG "super expansion cycle," with the supply side being reshaped towards a "US-Qatar dual-core" model, while demand experiences moderate growth alongside regional divergence. The market will transition from tight balance to a looser state, driving down the price centers in Europe and Asia. Concurrently, due to robust export and power demand, the US market is set to enter an upward price cycle.
Looking back at the current situation, the period from 2020 to 2024 saw the global natural gas industry complete a full cycle of "demand collapse and low prices – supply shock and price surge – supply ease and price decline." After experiencing extreme volatility, the Dutch TTF spot price has retreated. The global trade landscape has been structurally reshaped: the EU's share of LNG imports first rose then fell, the US leaped to become the world's largest LNG exporter, and China returned to its position as the top importer. The industry is accelerating its evolution from "regional markets" towards a "globally integrated, LNG-dominated" structure.
In 2025, the global natural gas market is characterized by "slow volume growth, high prices, and a structurally tight balance." Demand growth is slowing to 0.9%. On the supply side, while reliant on new LNG project increments from North America, tightness persists due to factors like interruptions in Russian pipeline gas. On the demand side, Europe is engaging in high-priced inventory replenishment due to low storage levels, Asian demand is growing steadily, and although China's natural gas demand growth has slowed short-term, it is expected to return to a high-growth trajectory.
From 2026 onwards, a significant reshaping of supply and demand is anticipated under the LNG "super expansion cycle," leading to a downward shift in the price centers for Europe and Asia. The supply side will see 2026 become a key inflection point. From 2026 to 2030, approximately 202 million tonnes of new LNG capacity is projected to be added cumulatively, representing a roughly 40% increase from 2025 levels, with an average annual growth rate of about 6.8%. This capacity expansion is highly concentrated in North America and the Middle East, accelerating the reshaping of the supply map from "multi-polar and dispersed" towards a "US-Qatar dual-core" structure.
Simultaneously, the "westward retreat and eastward advance" of Russian pipeline gas, combined with the EU's phased ban on Russian gas, will lead to a continued decline in the global share of pipeline gas. Consequently, LNG's pricing power in global marginal supply will further increase, shifting natural gas pricing to a "US LNG + Qatar LNG" benchmark. By 2030, the share of LNG export capacity held by the US and Qatar will rise significantly, while Australia's share declines. This change brings multiple impacts, including concentrated bargaining power, lengthened trade routes, and the marginalization of high-cost projects. Global LNG project development plans are accelerating further, with the number of projects reaching FID from January to October 2025 seeing a substantial increase.
On the demand side, global natural gas demand is expected to see a compound annual growth rate of about 1.56% from 2025 to 2030, indicating a trend of moderate expansion. Regional divergence is pronounced: the Asia-Pacific region shows the fastest demand growth, with China as the core growth engine; demand in the Middle East and Africa grows steadily; whereas European demand is contracting due to renewable energy substitution and decarbonization policies. North America's own demand growth is below 1%, primarily supported by the power sector.
The global LNG market will gradually shift from a tight balance in 2025 to a looser state, entering a slightly loose phase in 2026, transitioning to a supply surplus in 2027, and reaching a peak surplus in 2029. This supply-driven easing will cause the global gas price system from 2026-2030 to switch from being "supply-constrained" to being governed by "cost constraints + demand elasticity." Price transmission will be anchored to the marginal supply costs of the US and Qatar, with European TTF and Asian JKM benchmark prices converging towards the landed cost of US-sourced gas, leading to a gradual downward trend in the medium-to-long-term price center.
The US natural gas market is currently in a pattern of "limited supply elasticity and continuously expanding demand." The ramp-up of LNG exports and power demand driven by data centers are the core growth engines, pushing the market from a tight balance gradually towards a potential shortage. The Henry Hub price center is expected to rise significantly by 2027, marking the start of a new upward price cycle. The full-cycle cost for future new US natural gas wells is concentrated in the $3-3.5/MMBtu range, which will form a support level for the long-term Henry Hub floor price.
Entities such as EQT, a leading US upstream natural gas producer; Cheniere Energy, a leading LNG exporter; and midstream quality leaders like Energy Transfer and Kinder Morgan, may continue to benefit from the US LNG export boom cycle.
Comments