LNG Companies Welcome Trump's Lift on Export Permit Freeze

The decision by President Donald Trump to lift the freeze on LNG export permits has been hailed by companies in the industry, as it opens the door for increased US exports and bolsters their competitiveness in the global market. The move, which reverses a policy implemented by former President Joe Biden, is expected to have significant implications for the LNG market dynamics, particularly in terms of supply and demand balance.



The lifting of the freeze will allow for the approval of new LNG export projects, leading to an increase in US LNG supply. This includes projects like Commonwealth LNG, Venture Global's CP2, Cheniere Energy's Sabine Pass expansion, and Energy Transfer's Lake Charles terminal, among others. According to Rystad Energy, US LNG export capacity could nearly double from 11.3 billion cubic feet per day (Bcfd) in 2023 to 22.4 Bcfd in 2030, bolstering global supply (Source: Rystad Energy).

However, the rapid expansion of US LNG supply could lead to an untimely supply boost, heightening the risk of a medium-term market glut. This could put downward pressure on prices, as seen in the past when oversupply led to a sharp decline in spot LNG prices (Source: World LNG Report, 2024). The increased US LNG supply could also be used as a bargaining chip in trade negotiations with Europe, Russia, and other major economies, potentially affecting the geopolitical dynamics of the LNG market.



In conclusion, the lifting of the freeze on LNG export permits by President Trump will likely lead to an increase in US LNG supply, which could impact the global supply and demand balance, geopolitical dynamics, and prices in the LNG market. However, the extent of these impacts will depend on the push and pull of various forces in the market, and companies will need to navigate these dynamics strategically to maintain their competitiveness in the global LNG market.