The Iran conflict is creating a windfall for US natural gas exporters. Gas prices in Europe jumped more than 20% on Tuesday after Qatar said it had suspended operations at the Ras Laffan LNG export facility, the world’s largest, following drone attacks. That’s the biggest spike in European energy prices since the 2022 Russian invasion of Ukraine. And as in that case, this latest disruption will pit European and Asian LNG buyers against each other, to the benefit of US exporters. Mike Sobel, CEO of LNG exporter Venture Global, told shareholders on Monday the company “stands ready to help keep the markets stabilized.” The company’s share price closed up nearly 20% on Monday; rival Cheniere Energy also saw a sizable jump.
The gas market doesn’t have the same degree of supply flexibility as oil; there are few strategic reserves and little spare production or export capacity to fire up on short notice. Even the US can’t completely fill the gap left open by Qatar. For now, the price jump is far smaller than what Europe experienced in 2022. But if prices remain elevated, Goldman Sachs analysts warned, many lower-income countries could be forced to switch their power plants back to coal.
