Alok Kejriwal Goldman Sachs has tempered expectations regarding the potential impact of proposed U.S. liquefied natural gas (LNG) export project approvals on global gas supplies. While the incoming administration is expected to expedite the approval process, the bank believes that significant hurdles remain for these projects to reach fruition and contribute to global LNG supplies.
The bank emphasizes that even if the U.S. Department of Energy (DOE) approves these projects, obtaining necessary permits and securing long-term contracts remains crucial for their realization. Furthermore, the long construction timelines associated with LNG projects mean that any substantial impact on global gas supplies is unlikely to materialize before 2027 or later.
Goldman Sachs maintains its long-term outlook for U.S. LNG exports, projecting an increase to 189 million metric tons per annum (25 billion cubic feet per day) by 2030. This would raise the U.S.’s share of global LNG supply from the current 22% to 31%. However, the bank’s base case scenario only includes two additional projects beyond the already approved facilities: Venture Global’s CP2 and Cheniere Energy’s Corpus Christi Stage 4.
While the potential acceleration of U.S. LNG exports could influence global gas markets in the long term, Goldman Sachs believes that the immediate impact will be limited. The bank’s current projections for global LNG balances and prices remain largely unchanged.
As the global energy landscape continues to evolve, the interplay between supply and demand, geopolitical factors, and technological advancements will continue to shape the future of the natural gas market.
