Cold weather in Europe is driving LNG demand, with the region leading global trade since January, securing cargoes to meet winter energy needs.
Come spring, Europe must refill its fast-depleting storage for next winter, but overregulation could be a risk.Global LNG imports hit a 12-month high in January at 38.12 million tons, per Kpler data, with Europe outbidding Asia for supply despite its claim of short-term reliance on LNG.Reports indicate Europe diverted LNG from Oman and even Australia—though Omani LNG is cost-effective, Australian supply is typically too expensive due to distance.
Europe imported record Russian LNG despite calls for a ban, highlighting its ongoing reliance due to limited pipeline supply.The EU’s collective gas-buying system mandates 90% storage fill by November to prevent winter shortages.
However, these mandates turn the LNG market into a sellers’ game, pushing up prices—bad news for a cash-strapped Europe and poorer nations struggling to compete.Since ditching Russian pipeline gas, Europe has repeatedly driven up LNG demand, creating a trend.
By mandating LNG purchases, the EU harms itself and the climate, pushing poorer nations toward coal and giving sellers more pricing power—an unintended but costly consequence.
