LNG Prices Poised for Winter Surge Amid Record-Low European Gas Stocks

Global liquefied natural gas (LNG) prices are expected to surge this winter due to low European gas stocks and increased competition from North Asian buyers. According to industry executives, Europe's storage levels are at a record low for this time of year, with the EU's gas stocks currently at 67% full.

The Strait of Hormuz closure has also prevented Qatar and the United Arab Emirates from shipping LNG, resulting in a loss of 36 million metric tons of supply this year. Shell's President of Integrated Gas Cederic Cremers warned that 'we can all hope for a warm winter' but noted that there will likely be more restocking needs going into the winter.

Industry experts predict that prices may reach $40/mmBtu if it's a colder winter than normal, which could lead to some demand destruction due to high costs. Equinor's Senior Vice President Marketing and Supply Helle Ostergaard Kristiansen noted that European buyers will likely have to compete with Asia for US supplies.