Iran War Crimps Global Gas Supply, Handing U.S. LNG Exporters a Windfall

More than six weeks into the U.S.-Israeli war with Iran, a naval blockade at the Strait of Hormuz is keeping one critical commodity bottled up: liquefied natural gas, the fuel that heats homes and runs power plants across Asia and Europe — and increasingly on Florida's own grid.

Qatar's state-owned QatarEnergy produces roughly a fifth of the world's LNG supply. Early strikes on its facilities during the conflict left its export terminals damaged, and energy experts say repairs could take several months, with a return to full production capacity potentially years away. QatarEnergy has not commented publicly on the damage.

With Qatar largely sidelined, U.S. LNG companies have moved to fill the gap. The U.S. set a record for LNG exports in March. Companies have been purchasing domestic natural gas at roughly $3 per million British thermal units, then selling it overseas at around $20 per million BTUs — a margin that Columbia University international natural gas expert Ira Joseph calls "a huge influx of cash." Shares of U.S. LNG giant Cheniere Energy have risen about 10 percent since the war began; Venture Global, another American exporter, has seen its stock climb roughly 30 percent.

For Treasure Coast residents, this matters because Florida draws an outsized share of its electricity from natural gas — more than 70 percent of the state's power generation, according to federal energy figures — making wholesale gas price spikes an upstream pressure on FPL and other utilities that serve Martin, St. Lucie, and Indian River counties. When global LNG prices surge, domestic natural gas prices tend to follow, and Florida ratepayers have historically felt those swings in their monthly bills.

Energy Secretary Chris Wright told executives gathered at the CERAWeek conference in Houston this month that continued investment in U.S. LNG exports is the answer to the global shortage. Several new U.S. terminals are under construction; Cheniere completed a new section of its Corpus Christi facility in late March. S&P Global Energy projects U.S. LNG supply will grow roughly 84 percent over the next five years.

But industry executives themselves acknowledged the boom carries risks. Mark Abbotsford, chief commercial officer at Woodside Energy, warned at CERAWeek that sustained high prices could trigger "demand destruction" — pushing developing nations such as the Philippines, Vietnam, and Thailand toward coal, which produces more carbon dioxide when burned. Pakistan has already moved in the opposite direction, cutting LNG imports as solar and battery storage capacity expanded rapidly.

Venture Global closed on $8.6 billion in financing last month for a Louisiana LNG project slated to begin deliveries next year. Whether that investment pays off depends heavily on how long the Strait of Hormuz remains blocked — a timeline no one in Houston or Washington has been able to determine.

This article was generated with AI assistance using publicly available information. It was reviewed and approved by a human editor before publication. TC Sentinel uses AI writing tools in accordance with FTC guidelines.