WoodMac’s Gas, LNG and the Future of Energy conference: five key themes

Against a febrile geopolitical backdrop, Wood Mackenzie hosted its third annual Gas, LNG and the Future of Energy conference in London last week. The event featured senior leaders from Uniper, Shell, Cheniere, PetroChina International, Mercuria, SEFE, Moelis and many more. Here are the major themes that stood out across the two days:

Don't bet against US LNG

Tariffs, cost inflation, competition for gas from domestic consumers and/or upward pressure on Henry Hub prices (see point below) all threaten the expected future growth of US LNG capacity growth. But the general message was that the risks can be managed. With the Trump administration full bore behind LNG exports, there was high confidence that US LNG will remain the central pillar of global supply well into the future.

And the world needs more US LNG. Aside from Qatar, no other country will come close to matching the scale of new US volumes (raising concerns about the diversity and resiliency of buyers’ supply portfolios). We expect six US Gulf Coast projects to move ahead by 2027, adding an additional 68 mmtpa of capacity on top of the 65 mmtpa currently under construction. Buyers are lining up to secure more contracts, as JERA’s 5.5 mmtpa of deals with several US projects announced the day after the conference underlined.

In sharp contrast, Australia, not so long ago the largest supplier of LNG to the global market, was barely mentioned.

Higher Henry Hub prices - a major bone of contention

The future direction of US gas prices spawned a lively debate. WoodMac’s analysis is that strong US gas demand growth (including from data centres and US LNG exports) combined with supply dynamics requiring more dry gas as operators stick tightly to capital discipline, will push Henry Hub as high as US$5/mmbtu (real) by 2035. Higher gas costs and weaker selling prices into Japan and Europe as the coming LNG supply wave hits the market would be a double whammy for offtakers that have enjoyed buoyant margins since 2022. Higher Henry Hub might not diminish appetite for US LNG (as above), but it would change future LNG project economics.

Dissenting voices included some US project developers and offtakers expounding the Lower 48’s capacity to produce plenty of new volumes of low-cost gas. This is possible of course, but with demand booming and suppliers looking for improved returns to bring gas to market, upside risks to prices can’t be ignored.

Lower global LNG prices will fire-up demand

The anticipated softening of traded LNG prices through to 2030 as the market absorbs the next supply wave proved less contentious. The general view was that a downturn is not only survivable and may have a positive side. After three years of elevated prices, more affordable LNG will kick-start the next phase of LNG demand growth, particularly in price-sensitive emerging Asian markets.

But how low prices must prices go for the market to absorb the 175 mmtpa of LNG supply currently under construction, plus capacity that is looking to take final investment decision soon, stoked the debate. We think Asian LNG spot prices will need to reduce to US$8-8.5/mmbtu by 2030, compared to the 2024 average traded price of US$12/mmbtu. Some suppliers in the room were less pessimistic, believing demand will surprise on the upside. Everybody agreed, however, that beyond the downcycle more supply will be needed to meet long-term demand growth. Where it comes from, beyond the US and Qatar, remained largely unanswered.

The LNG ecosystem is in rude health

For decades, the LNG industry had a reputation as something of an elite ‘club’, with a limited number of players dominating the value chain. This year’s conference highlighted how those days are over. In only its third year, our event drew a high-profile guest list from across a continuously expanding ecosystem. Geographically disparate suppliers and buyers, infrastructure players, traders, financiers, service sectors and specialist consultants reflect how much the industry has evolved.

A diverse sector with depth and breadth through the value chain should be more resilient and able to thrive through the challenges ahead.

Russia is the major risk to LNG growth in Europe and China

The potential return of Russian gas to Europe remains a divisive issue. In an audience poll, a majority reckoned a return of imports via the Nord Stream pipelines is a matter of when, not if. Industry speakers expressed diverging views, with the Russian gas panel discussion suggesting some flows through Ukraine were a more palatable option in the event of a peace agreement. There was more consensus that Russian LNG will expand further through the long-term in a post-sanctions' world. And it’s not just Europe that could import more Russian gas: we heard of progress being made to develop an additional Power of Siberia pipeline to China. With China key to future LNG demand, global LNG developers and European gas players were taking notes.

Registration is now open for Wood Mackenzie’s Gas, LNG & the Future of Energy 2026 event. We look forward to seeing you there.

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