ARKANSAS, Dec 02 (Future Headlines)- In November, U.S. liquefied natural gas (LNG) exports witnessed a robust surge, reaching the second-highest monthly production level on record, standing at 7.99 million metric tons of superchilled gas. This substantial increase is indicative of the United States’ position as a major player in the global LNG market. The surge in LNG exports, coupled with market dynamics and regional trends, paints a comprehensive picture of the industry’s landscape.
November’s LNG export volumes were just shy of the record set in April, which stood at 8.01 million tons. The 7.99 million tons mark represents a notable increase from the 7.92 million tons shipped in October. These figures, gleaned from trade flows and tanker tracking data provided by financial firm LSEG, underscore the momentum and resilience of the U.S. LNG export sector.
The Energy Information Agency (EIA) has previously confirmed that the U.S. secured its position as the world’s largest exporter of LNG in the first half of the year, surpassing traditional players like Qatar and Australia. Analysts anticipate that new export plants slated to commence production in the coming year will further solidify the United States’ status as the leading LNG exporter on the global stage.
As winter sets in across the northern hemisphere, U.S. LNG producers have strategically directed their exports toward Europe. In November, approximately 68% of all U.S. LNG exports were destined for Europe, reflecting a slight increase from the 65% recorded in October. The region’s heightened demand for LNG during colder months aligns with the U.S. strategy to cater to the evolving needs of the global market.
Despite lower-than-normal temperatures in Europe, analysts at consultants Rystad Energy suggest that elevated storage levels are likely to prevent a substantial increase in prices. European gas storage was reported to be around 97% full at the end of November, indicating a surplus that may temper price dynamics. Rystad Energy noted that while increased heating demand is expected, the overall demand outlook may remain bearish due to soft industrial activity and robust renewable energy output in the region.
U.S. gas futures this week exhibited variations across key hubs. Prices averaged $2.78 per million British thermal units (mmBtu) at the U.S. Henry Hub, $13.54 per mmBtu at the Dutch Title Transfer Facility hub, and $16.33 per mmBtu at the Japan Korea Marker in Asia. These pricing differentials highlight the diverse dynamics shaping the LNG market across regions.
While Europe continued to be a primary focus for U.S. LNG exports, fewer cargoes were directed toward Asia last month. Exports to Asia dipped to 18.5% of the total, down from 20% in October. Meanwhile, shipments to Latin America remained relatively stable at around 5% of the total. These shifts in regional export destinations underscore the flexibility and adaptability of the U.S. LNG export sector to respond to market demands.
Natural gas flows to the seven major U.S. LNG export plants reached a record 14.3 billion cubic feet per day (bcfd) in November. This marked an increase from 13.7 bcfd in October and surpassed the prior all-time high of 14.0 bcfd recorded in April, according to LSEG data. The sustained high levels of gas flows underscore the operational efficiency and capacity utilization of U.S. liquefaction plants.
Rystad Energy highlighted that the 30-day average utilization rate for U.S. liquefaction plants is running close to 106% of nameplate capacity. This indicates the robustness of the infrastructure supporting LNG production and export activities.
The surge in U.S. LNG exports to near-record levels in November reflects the resilience and growth trajectory of the country’s LNG export sector. As the United States consolidates its position as the world’s largest LNG exporter, strategic shifts in regional focus, pricing dynamics, and operational efficiency contribute to shaping the industry’s landscape. The sector’s ability to navigate market complexities and meet evolving global demand positions it as a key player in the dynamic and competitive LNG market.
Reporting by Moe Khaled; Editing by Sarah White