KUWAIT: The Secretary-General of the Arab Energy Organization (AEO), Jamal Al-Loughani, emphasized the significant developments and transformations witnessed by the liquefied natural gas (LNG) industry over the past six decades. He attributed this expansion to rapid advancements in technological solutions and innovations, which have facilitated the geographical spread of LNG operations.

Speaking to Kuwait News Agency (KUNA) on Monday, Al-Loughani made these remarks on the occasion of AEO — formerly the Organization of Arab Petroleum Exporting Countries (OAPEC) — publishing a new study titled Global LNG Markets: Recent Developments and Future Prospects. The study provides a comprehensive review and analysis of technological, commercial, and environmental trends, particularly over the last two decades.

Al-Loughani highlighted key technological innovations in liquefaction, transportation, regasification, and storage, noting that advancements in maritime transport have led to the development of specialized vessels with increased capacities. This progress has significantly contributed to the expansion of the global LNG fleet. He further underscored the role of LNG in addressing global energy challenges, stating that the ongoing energy crisis has reinforced LNG’s strategic importance, with projections extending until 2050.

He pointed out that floating storage and regasification units (FSRUs) have played a pivotal role in mitigating Europe’s energy crisis since February 2022. By reducing logistical constraints and expediting LNG supply chains, these units have proven invaluable. Al-Loughani also acknowledged the crucial role LNG played during the Russia-Ukraine crisis, particularly in 2022, which was marked as the most volatile year in the history of gas markets. LNG enabled Europe to stabilize its energy supplies, proving its reliability and flexibility as an alternative energy source.

He credited major LNG suppliers, notably the United States, Qatar, Algeria, and Nigeria, for their role in bolstering Europe’s energy security by increasing LNG exports. The Russia-Ukraine conflict, he noted, has positioned LNG at the center of geopolitical dynamics, reshaping global energy dependencies and trade relations. Furthermore, he highlighted the European Commission’s decision in May 2022 to reduce reliance on Russian gas, which has had significant geopolitical ramifications, altering maritime routes and sea lanes due to security concerns.

Discussing global LNG trade patterns, Al-Loughani noted that LNG has surpassed pipeline gas in market dominance due to the Ukraine crisis, transforming Europe from a balanced market to a major demand center. He stated that in 2022 and 2023, the United States, Qatar, and Australia accounted for approximately 60 percent of global LNG exports. The ongoing crisis also enabled the United States to emerge as the world’s largest LNG exporter for the first time in 2023, solidifying its position as a key player in the market.

Looking ahead, Al-Loughani outlined bullish projections for global LNG demand, emphasizing that Asia is expected to lead market growth in the medium and long term due to multiple economic and industrial factors. He stated that future supply expansions will primarily come from the United States and Qatar, with Qatar aiming to increase its LNG production capacity from 77 million tons per year to 142 million tons by 2030 through its North Field expansion project. Similarly, the United States is projected to double its LNG export capacity by 2028 if current projects progress as scheduled.

Despite optimistic demand forecasts, Al-Loughani cautioned that the LNG industry will encounter challenges shaped by economic uncertainties, geopolitical tensions, and regulatory complexities, particularly within the European Union, which has introduced stringent environmental policies.

He also predicted that the North Atlantic region is poised to become a critical hub for LNG trade, linking Europe and the United States — two of the world’s most liberalized energy markets. However, he noted that evolving regulatory frameworks in the EU could prompt LNG exporters to explore alternative markets outside Europe. Al-Loughani concluded by reiterating the growing strategic importance of LNG, emphasizing its role in shaping the future of global energy markets amid evolving geopolitical and economic landscapes. — KUNA