Latin American LNG demand dries up

The return of hydropower, economic pain and cheaper alternatives are dampening regional LNG consumption

LATIN America has emerged as an important liquefied natural gas market in recent years. But the region’s demand for the supercooled fuel will reverse over the course of this year, with Brazil, Argentina and Mexico all likely to take less LNG. Slowing regional demand will put pressure on producers Trinidad & Tobago and Peru, which will also have to contend with the arrival of US LNG. Brazil has emerged as a major LNG buyer in recent years. Gas is a marginal fuel in Brazil, typically used to plug gaps in power demand when hydropower output falls. Severe drought has sapped output from the country’s hydropower base in recent years, leading to a surge in gas demand. LNG imports have been used