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Gas & LNG: Year in Review and 2026 Outlook

Gas & LNG: Year in Review and 2026 Outlook

Published on January 28, 2026

Our Gas & LNG team reflect on the some of the key themes in LNG and Gas during 2025 and what to look out for in 2026 including market reactions to the first post-2022 year of meaningful supply additions, the outlook for European LNG imports and West-to-East flows, and how LNG portfolio holders manage length through downstream positions and regas access.

Please get in touch with Tom Field or Adam Doran if you’d like a more in-depth conversation.

LNG supply reached 435 mt in 2025 – higher European imports required a reduction in Chinese demand, preventing a material price decline

 

LNG trade in 2025
Based on vessel tracking data

Source: Vortexa, Energex

    • Global LNG supply reached 435 mt in 2025, a7% increase compared to 2024

    • 2025 saw a significant increase in LNG deliveries to Europe, which ramped up its imports by 28 mt

    • As global supply additions were not sufficient to meet total demand growth, Asian imports had to decline

    • The majority of Asian demand reduction came from China, which saw an 11% year-on-year reduction, primarily due to lower demand and stronger supply from other sources in the first half of the year

    • Egypt and Bangladesh also saw material year-on-year increases, reflecting domestic gas supply crises, with Taiwan also requiring an increase in imports following the phasing out of nuclear generation in the country

Higher European LNG imports were crucial in refilling depleted storage levels, replacing Russian supply lost at the start of 2025 and meeting demand in the EU and Ukraine

 

Change in European gas balance
Difference in supply and demand between 2025 and 2024, Bcm

Source: ENTSOG Transparency Platform, AGSI, Energex

    • The European gas market entered 2025 facing the loss of approximately 14 Bcm of Russian gas supply via Ukraine

    • Higher LNG imports more than offset the reduction in supply, resulting in a 19 Bcm total year-on-year increase in supply

    • This was required to meet an approximately 2% increase in demand, as well as the increased storage injections required after stock levels were left at 35% of total capacity at the end of the winter

    • Higher LNG imports also enabled Europe to ramp up its exports to Ukraine following Russian attacks damaged its natural gas infrastructure, which reached over 7 Bcm in 2025, an increase of almost 5 Bcm compared to 2024

Higher LNG imports in Western Europe and Italy played the most significant role in enabling stronger Eastwards flows

 

Increase in Eastwards gas flow from key LNG importing market
Net change in gas flows between countries between 2025 and 2024, Bcm
Source: ENTSOG Transparency Platform, AGSI, Energex

    • Higher LNG imports were crucial in enabling stronger flows to Central and Eastern European (CEE) countries, the markets most affected by the reduction in Russian pipeline supply

    • Italy saw the largest year-on-year increase in LNG imports, becoming a net exporter to Austria for the first time

    • Germany also saw one of the largest year-on-year increases in LNG imports, which, together with stronger imports from NW European LNG importers, reinforced its role in enabling CEE countries to access higher LNG imports

Global LNG supply increased by 29 mtpa, almost entirely due to the ramp up of new North American export projects

2025 increase in LNG supply
Based on vessel tracking data, mt LNG
Source: Vortexa, Energex

    • Global LNG supply grew by ca. 29 mt in 2025, a 7% year-on-year increase

    • The majority of this growth came from the ramp up in production at Plaquemines LNG in the United States

    • LNG Canada also began production in the second half of 2025, but technical issues have limited output so far; a ramp-up to full production is expected in 2026

    • Corpus Christi LNG Phase 3 also ramped up production in the second half of the year and is expected to further contribute to supply growth in 2026

2026 will mark the first year since 2022 in which supply additions may enable prices to remain at sufficiently low levels to stimulate a return to growth by Asian markets

2026 LNG market balance
Estimated based on publicly announced timelines for new projects

Source: Vortexa

    • Ramp up of new projects, primarily from the US, is expected to lead to a growth in global LNG supply of 35-40 mt in 2026

    • Unlike 2025, any further increase in European LNG imports will be well below the total supply growth expected for 2026, even assuming a demand increase in line with 2025 and a full replenishment of volumes in storage

    • For the market to balance, prices will have to fall sufficiently to enable a return to Asian demand growth

    • The response of Chinese demand following the year-on-year decline in 2025 will be especially important in setting the evolution of market prices in 2026

 

Strategies and commercial models will need to adapt to navigate the largest phase of market growth in the history of the LNG industry

 

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Large volumes of new supply have now started to enter the LNG market, which coupled with stagnating demand growth in Asian markets is likely to have a major impact on market dynamics

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Multiple new and growing players have built LNG portfolios by acquiring significant supply length in recent years; securing a diverse portfolio of downstream access points will grow in importance to balance and optimise portfolios

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Access to regasification capacity will be highly valuable; though limited long-term primary capacity is available in Northwest Europe we expect players will seek out capacity with longer-dated commencement to provide balance to growing long positions in portfolios

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The development of new supply will become more challenging, with stronger competition between pre-FID projects and successful projects likely to require their sponsors taking more market risk

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Building a deep understanding of and mitigating geopolitical risks is an increasingly key element of successful strategies for LNG market participants in a more volatile and unpredictable world

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As prices in the spot market and in long-term contracts begin to diverge, margins are expected be squeezed for a period, putting pressure companies to ensure fit for purpose commercial operating models (including the contracts that underpin them) are in place to ensure portfolio optimisation and mitigate value leakage

 

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