Europe’s liquefied natural gas (LNG) imports surged to an 11-month high in December, driven by early winter cold snaps and rising concerns over energy supply. U.S. LNG arrivals were also at their highest level since January 2024, marking a significant shift in Europe’s energy landscape.
After two relatively mild winters, Europe is experiencing its first harsh winter since the 2022 energy crisis, depleting natural gas reserves at the fastest pace in seven years. The cessation of Russian pipeline gas through Ukraine has further unsettled the European gas market, prompting buyers to increase LNG purchases.
Rising LNG Imports in Europe and Asia
According to data from commodity analysts Kpler, European LNG imports hit 10.89 million metric tons in December, a 23% increase from November’s 8.86 million tons. This was the highest level of LNG arrivals since January 2024, when Europe imported 11.18 million tons. Notably, December’s imports from the U.S. accounted for half of the total at 5.22 million tons, marking an 11-month high.
Interestingly, Europe’s higher LNG imports did not come at the expense of Asia, which also ramped up its imports to the highest level in nearly a year. The global LNG market saw significant growth in December, with Asia’s imports reaching their own 11-month peak.
U.S. LNG Plays a Crucial Role in Europe’s Energy Supply
Since Russia cut off gas deliveries to much of Europe following the invasion of Ukraine, the U.S. has played a growing role in supplying Europe’s energy needs. Norway has replaced Russia as Europe’s top pipeline gas supplier, while U.S. LNG now accounts for a significant portion of Europe’s imports.
As Europe’s gas inventories deplete, now sitting below the five-year average for this time of year, the continent will need to secure more overseas LNG to meet winter demands and replenish storage ahead of next year’s heating season.
U.S. LNG Expands Capacity
The U.S. LNG industry is poised to meet Europe’s growing demand. New export capacity, such as Venture Global’s Plaquemines LNG facility in Louisiana and Cheniere’s Corpus Christi Stage 3 project in Texas, is ramping up. Both plants began production in late December 2024 and are expected to increase exports significantly throughout 2025.
In December 2024, U.S. LNG exports surged to 8.5 million metric tons, marking a 4.5% annual increase compared to 2023. Of this, 5.84 million tons, or 69%, were shipped to Europe, up from 5.09 million tons in November. This brought total U.S. LNG exports for the year to 88.3 million tons, solidifying the United States’ position as the world’s top LNG exporter.
Expectations for 2025
The U.S. Energy Information Administration (EIA) forecasts that U.S. LNG exports will grow by 15% in 2025, reaching nearly 14 billion cubic feet per day (Bcf/d). This growth is largely driven by the expansion of export facilities like Plaquemines LNG and Corpus Christi Stage 3.
Europe’s gas storage needs could further benefit U.S. LNG exporters, as European inventories must be filled to at least 90% capacity by November 2025 in preparation for the 2025/2026 winter.
Higher European Prices Fuel U.S. LNG Demand
The recent rise in Dutch TTF Natural Gas Futures has made Europe more attractive for U.S. LNG exporters. As of last week, the front-month price for February delivery to northwest Europe was $14.90 per MMBtu, the highest since October 2023. This increase has effectively closed the price gap between U.S. LNG and northeast Asia, favoring shipments to Europe instead.
Despite the Panama Canal becoming a viable option for LNG shipments to Asia in 2025, analysts note that the price difference to northeast Asia remains unattractive. According to Spark Commodities, the arbitrage between the U.S. and northeast Asia is still closed, further incentivizing U.S. LNG deliveries to Europe.
As Europe continues to depend on LNG imports to meet its energy needs, the U.S. stands poised to play a key role in supplying the continent throughout 2025.
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