Key Moments
- Bernstein projects global LNG demand at about 441 mtpa in 2026, an increase of roughly 8.5% year on year, led almost entirely by Asia.
- Approximately 93 mtpa of new LNG capacity is expected to come online across 2025 and 2026, pushing the market back into net-long supply.
- Spot LNG prices are forecast to drop from around $12 per mmbtu in 2025 to an average of about $9 per mmbtu over 2026 to 202, with potential downside toward $5 to $6 per mmbtu.
Demand Outlook: Asia Leads, Europe Levels Off
Liquefied natural gas prices are expected to face sustained downward pressure in 2026 as the sector absorbs what Bernstein describes as the largest supply expansion in its history. In a note issued on Friday, analysts led by Neil Beveridge projected that global LNG demand will reach roughly 441 million tonnes per annum (mtpa) in 2026, representing growth of about 8.5% compared with the previous year.
According to the analysts, nearly all of this incremental demand is anticipated to come from Asia. In contrast, Europe’s LNG imports are seen stabilizing around 120 mtpa, based on an assumption that Russian pipeline gas returns only in a limited way.
The report noted that in 2025, European LNG purchases increased markedly as the region rebuilt inventories and replaced Russian pipeline volumes. Over the same period, LNG demand declined in major Asian markets including China, Japan and India, reflecting weaker growth in gas consumption and increased availability of domestic and pipeline supplies.
Supply Wave Reshapes Market Balance
On the supply front, Bernstein identified 2026 as a pivotal year. The firm highlighted that approximately 45 mtpa of new LNG capacity began ramping up in 2025, with a further 48 mtpa expected to start operations in 2026.
Key developments cited include Golden Pass LNG, Qatar’s North Field Expansion phases, Scarborough and Nigeria LNG Train 7. In total, these and other projects are expected to add about 93 mtpa of capacity across 2025 and 2026.
With this influx, Bernstein expects the LNG market to shift back into a net-long position from 2026 onward. The analysts see supply additions averaging roughly 50 mtpa per year through 2028.
Scale of Incremental Supply
After adjusting for project ramp-up profiles, the broker estimates that around 150 mtpa of additional LNG supply will reach the market between 2026 and 2028. The note described this as equivalent to adding about 35% of current global demand within just three years.
“This will get absorbed by the market, but at lower prices,” the analysts wrote. “This shift from a sellers to a buyers market benefits downstream gas companies over upstream supplier.”
| Period / Metric | Bernstein Estimate / Comment |
|---|---|
| Global LNG demand in 2026 | ~441 mtpa (up about 8.5% year on year) |
| European LNG imports | Stabilizing near 120 mtpa (with only limited Russian pipeline gas return assumed) |
| New LNG capacity ramping in 2025 | ~45 mtpa |
| New LNG capacity starting in 2026 | ~48 mtpa |
| Total new capacity 2025-2026 | ~93 mtpa |
| Average annual supply additions (2026-2028) | ~50 mtpa per year |
| Incremental supply (2026-2028) | ~150 mtpa (about 35% of current global demand) |
| Spot LNG price (2025) | ~$12 per mmbtu |
| Forecast average spot LNG price (2026-202) | ~$9 per mmbtu |
| Estimated marginal cash cost of LNG supply | $5 to $6 per mmbtu |
| Projects reaching FID in 2025 | ~68 mtpa |
Price Projections and Risk Scenarios
Bernstein forecasts that spot LNG prices will decline from around $12 per mmbtu in 2025 to an average of roughly $9 per mmbtu over the 2026 to 202 period.
For now, prices are described as elevated, supported by lower European gas inventories and seasonal heating demand. However, the analysts expect these supports to weaken as new supply ramps up.
If the market struggles to absorb the incremental volumes, Bernstein warns of considerable downside risk. Under such a scenario, spot prices could slide toward the marginal cash cost of LNG supply, which the firm estimates at $5 to $6 per mmbtu. This could increase the likelihood of production shut-ins in North America.
On the other hand, the note highlights upside risks linked to potential strength in Henry Hub gas prices. Stronger domestic gas demand in the U.S. could constrain LNG exports and help tighten the global market.
Investment Decisions and Project Pipeline
The analysts also pointed to implications for future project approvals. Following what they describe as a record year in 2025, when around 68 mtpa of projects achieved final investment decision (FID), Bernstein expects fewer projects to be sanctioned in 2026.
The firm attributes this expected slowdown to a narrowing spread between JKM and Henry Hub prices. In this environment, Bernstein believes only the most cost-competitive projects are likely to progress in the near term, while higher-cost or marginal developments are more likely to be delayed.
Longer-Term Demand Still Anchored in Asia
Although the near-term landscape is dominated by oversupply and softer prices, Bernstein maintains that the long-run demand story for LNG remains intact. The analysts reiterate that Asia is expected to generate the vast majority of LNG demand growth through 2030, underpinned by coal-to-gas switching and energy security objectives.
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