JKM globalises the gas market
In Asia, an increasingly liberalised LNG market has enabled the region to mitigate a lack of interconnected pipeline infrastructure
LNG liberalisation—the move from a procurement structure to one that is market-based—has globalised the natural gas market, creating a virtual pipeline between continents. On the supply side, the shale gas revolution turned the US into a net gas exporter, while independent terminal developer Cheniere’s pioneering business model of selling LNG on a free-on-board (Fob) basis indexed to a gas benchmark is widely credited as a catalyst for the change in market structure. For LNG buyers, the unwinding of long-term legacy LNG contracts and access to US gas that held, initially at least, a large discount to price levels in the demand centres of Europe and Asia further precipitated this development.
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Energy sanctions are becoming an increasingly prominent tool of US foreign policy, with the country’s growth in oil and gas production allowing it to impose pressure on rivals without jeopardising its own energy security or that of its allies, argues Matthew McManus, a visiting fellow at the National Center for Energy Analytics
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The March 2026 issue of Petroleum Economist is out now!
