Global LNG supply to grow 44% in 2015-20

Natural gas from the US is being shipped globally. The US has exported natural gas to Brazil and also India, with the help of the Sabine Pass LNG export project in Louisiana. Currently, the US has five projects and 13 liquefaction trains under construction. Overall, these will help the US with an option of shipping around 62 MMt/y of natural gas by 2020, according to Barclays.

However, the rising glut in global LNG markets has been the main focus currently and also on how US LNG will compete in the market, noted Barclays. The offtakers have the right not to lift cargoes based on arbitrage windows and global price signals. Moreover, decisions regarding lifting cargoes or not will impact global gas markets and also the demand and supply balance of the gas market of the US, added Barclays.

There has been a considerable decline in benchmarks of global gas due to decelerating demand growth, rising LNG volumes and lower oil prices. Currently, around 140 MMt/y of LNG capacity is under construction globally. The global gas prices outlook remains bearish.

“In 2015-20, we expect global LNG supply to grow 44%, to 355 MMt/y”, said Barclays.