US LNG Exports at Risk of $120 Billion Impact Due to Changing European Restrictions on Russian Gas

A new S&P Global Commodity Insights study warns of a significant impact on US LNG exports if European policies regarding Russian gas change. The study outlines three scenarios: "Current Trend" (33.7 MMtpa), "Opening the Taps" (16.5 MMtpa), and "Phasing Down" (45.5 MMtpa), each with varying impacts on US LNG investments. The study predicts a $120 billion impact on US LNG exports if European policies change, with up to 29 MMtpa in project decisions at stake.

A new study by S&P Global Commodity Insights has highlighted the significant potential impact on U.S. Liquefied Natural Gas (LNG) exports if European policies regarding Russian gas change. The study, titled "U.S. LNG Exports at Risk: Potential Unwinding of Sanctions on Russian Natural Gas," examines three distinct scenarios: "Current Trend," "Opening the Taps," and "Phasing Down," each with varying implications for U.S. LNG investments.

Under the "Current Trend" scenario, the U.S. is expected to see 33.7 million metric tons per annum (MMtpa) in new LNG projects by 2025-2027, with a total value chain direct expenditure of $138 billion over the same period [1]. However, if European policies shift to "Opening the Taps," where U.S. sanctions on Russian gas are lifted, the number of new U.S. LNG projects could drop to 16.5 MMtpa, representing a $70 billion reduction in related investment [1].

Conversely, if Europe adopts a "Phasing Down" policy, where Russian LNG and piped gas are significantly reduced, the number of U.S. LNG projects could increase to 45.5 MMtpa, adding an additional $48 billion in related investment [1]. The study predicts that the combined impact of these two scenarios could result in a $120 billion shift in U.S. LNG investments, with up to 29 MMtpa in project decisions at stake.

Carlos Pascual, Senior Vice President, Global Energy, S&P Global Commodity Insights, commented, "Any changes to restrictions on Russian gas flows to Europe would dramatically impact U.S. LNG in market share and investment. On the downside, unwinding Russia sanctions would reduce the market for U.S. LNG, curtailing investment in future U.S. projects and simultaneously undermining European efforts to diversify gas imports" [1].

The study underscores that U.S. LNG is disproportionately impacted across the scenarios due to its role as a balancing supply for global LNG markets. Its contractual structures and U.S. market liquidity make it highly responsive to price signals. Given the volatility in European policy on gas exports and imports, the study suggests that future policy decisions could evolve based on broader political circumstances in Europe and globally [1].

The report is available at: [https://www.spglobal.com/en/research-insights/special-reports/us-lng-exports-at-risk-potential-unwinding-of-sanctions-on-russian-natural-gas](https://www.spglobal.com/en/research-insights/special-reports/us-lng-exports-at-risk-potential-unwinding-of-sanctions-on-russian-natural-gas).

References:
[1] https://www.morningstar.com/news/pr-newswire/20250508ny82772/changing-restrictions-on-russian-gas-to-europe-would-disproportionately-impact-us-lng-exports-new-sp-global-commodity-insights-study-finds