Increased US LNG export shipments could cause domestic price hike

Increased US LNG export shipments could cause domestic price hike

The agency that regulates US futures and options markets has warned that the coming boom in liquefied natural gas (LNG) exports could cause a big hike in prices for domestic consumers, according to Bloomberg.

In a study the Commodity Futures Trading Commission (CFTC) found that shipping large quantities of LNG overseas on tankers could have repercussions that see domestic prices rise as much as 20%.

The US currently has two LNG export facilities – Cheniere Energy’s Sabine Pass terminal in Louisiana, and Dominion Energy’s Cove Point in Maryland – although several more are in the works.

US President Donald Trump has been strongly in favour of US energy independence, advocating for expanded offshore coil and gas drilling.

He has also been a cheerleader for America shipping overseas its surplus LNG as the shale boom continues.

CFTC cited studies by the American Petroleum Institute (API), the US Energy Department and Deloitte to back up its conclusion that “there is a potential for U.S. domestic natural gas markets to be influenced by global supply-demand factors”.

Donal Scully

With 28 years experience writing and editing for newspapers in the UK and Hong Kong, Donal is now based in California from where he covers the Americas for Splash as well as ensuring the site is loaded through the Western Hemisphere timezone.

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