Australia’s LNG Market Faces Oversupply Threat

An impending slump in exports and diminishing returns on investment threaten Australia’s liquefied natural gas (LNG) industry as global markets head towards a supply glut.  In a new report by the Institute for Energy Economics and Financial Analysis (IEEFA), analysts found that unprecedented increases in low-cost producer supply and weak demand growth contribute to a potential LNG oversupply.  According to Joshua Runciman, IEEFA’s Lead Analyst, global LNG markets are expected to achieve a 40 percent increase in supply until 2028. With this structural change happening, emerging markets will bear the brunt of moderate demand increases. However, the direction of growth of this demand remains to be seen as it has consistently declined since 2019. ...