Gulf LNG Export Recovery to Ease Global Gas Prices From 2027
Global liquefied natural gas (LNG) exports from the Gulf are expected to begin recovering in 2027, relieving pressure on international gas markets rather than settling at permanently higher prices. Shipping disruptions in the Strait of Hormuz in 2026 restricted access to one-fifth of global LNG supplies and damaged 12.8 million tonnes per annum (mtpa) of Qatar's liquefaction capacity. Middle Eastern gas production is projected to fall by 98 billion cubic metres (bcm) in 2026, leaving between 38 and 59 bcm of global demand unserved.
The price surges in Europe and Asia represent transport and infrastructure shocks rather than a shortage of raw resources. A U-shaped supply recovery is anticipated starting in 2027 as new export projects arrive. Roughly 281.3 mtpa of liquefaction capacity currently under construction or commissioning, mainly in the U.S. and Qatar, is slated to start by 2031. This expansion is projected to create a supply surplus peaking at about 200 bcm in 2029 before demand rebalances the market in 2034.
Looking ahead, infrastructure development remains critical to meeting long-term demand, which is forecast to reach 5,180 bcm by 2035. About 166 bcm of planned 2035 supply across frontier markets like Senegal and Guyana lacks committed export routes. Simultaneously, approved U.S. export projects require 400 bcm more gas by 2035 than producers have committed, raising the risk of renewed supply limits by the mid-2030s.
Key points
- Gulf LNG exports are expected to recover starting in 2027 following 2026 shipping disruptions in the Strait of Hormuz.
- Middle Eastern gas output is set to decline by 98 bcm in 2026, leaving up to 59 bcm of global demand unserved.
- New projects in the U.S. and Qatar are expected to create a market supply surplus peaking at roughly 200 bcm in 2029.
- Global gas demand is forecast to increase to 5,180 bcm by 2035, driven primarily by power generation and Asia-Pacific growth.
- Long-term supply risks remain due to missing infrastructure commitments in frontier markets and uncommitted U.S. upstream production.
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How we writeDisclaimerQuestions and answers
When are global LNG prices expected to normalize after the Strait of Hormuz disruption?
Global gas markets and Gulf LNG exports are expected to begin recovering in 2027, rather than settling at permanently higher price levels, as new liquefaction capacity comes online.
What caused the global gas supply constraint in 2026?
Disruptions in the Strait of Hormuz restricted access to one-fifth of global LNG supply and damaged 12.8 million tonnes per annum of liquefaction capacity in Qatar, causing Middle Eastern production to fall by 98 bcm.
Is a global gas surplus expected in the coming years?
Yes. Roughly 281.3 mtpa of new liquefaction capacity under construction, mainly in the U.S. and Qatar, is projected to create a supply surplus peaking at around 200 bcm in 2029 before demand balances the market in 2034.