BAKU, Azerbaijan, November 3. Global LNG
supplies are expected to decline by 3%, equivalent to nearly 20
billion cubic meters (bcm), in 2026, marking the largest annual
drop ever recorded.


The projection is outlined in the International Energy Agency's
(IEA) Global Gas Security Review 2026.


According to the IEA forecast, the ongoing crisis in the Middle
East has had a significant impact on global natural gas and LNG
markets.


"From March through October, LNG shipments from Qatar and the
United Arab Emirates declined by more than 60 billion cubic meters
on an annualized basis," the review said.


According to the review, the decline was partly offset by
increased LNG production at new projects in North America and
Africa, as well as improved feedgas availability among existing
producers in Africa, Asia, and Russia.


"As a result, LNG production outside the Persian Gulf countries
increased by 14%, or more than 40 billion cubic meters, from March
through October on an annualized basis. This offset around
two-thirds of the decline in LNG supplies from the Persian Gulf
countries over the period.


Overall, global LNG production declined by 6%, or approximately
20 billion cubic meters, from March through October compared to the
same period last year," the agency's review says.


Amid disruptions to LNG supplies through the Strait of Hormuz,
gas prices in Asia and Europe reached their highest levels since
the 2022-2023 energy crisis.







"In Europe, spot gas prices at the TTF hub grew by nearly 70%
year-on-year from March through October, averaging around $20 per
million British thermal units (MMBtu).


Asian spot LNG prices rose by nearly 80% year-on-year over the
same period, averaging $21.5 per MMBtu.


From March through July, Asian spot LNG prices exceeded European
prices by around $2 per MMBtu. From August through October, the gap
narrowed to about $1 per MMBtu, indicating intensifying competition
for flexible LNG supplies ahead of the heating season.


Oil-indexed LNG prices also gradually increased and, according
to the IEA's estimates, reached $12-$14 per MMBtu in Q3 2026," the
agency reported.


The impact of rising oil prices is expected to become more
pronounced in Q4, as oil prices are typically reflected in gas
contract pricing formulas with a lag of 5-6 months.


The IEA forecasted that vessel traffic through the Strait of
Hormuz will remain largely restricted at least through the end of
2026. Under this scenario, global LNG supplies will decline by 3%,
or nearly 20 bcm, in 2026.