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Maguire: Rising Asia temperatures bode good for US LNG export prospects

The U.S. has already set records for exports of LNG in 2025. However, forecasts that temperatures will be above average across the key Asian markets could push them higher this summer.

All three countries are expected to maintain above-normal temperatures through August. This will likely increase the use of air conditioners that consume a lot of energy.

This higher demand will spur utilities to increase generation from all sources available, including natural gas plants that are fed mainly with imported liquefied gas (LNG).

This positive outlook for demand is good news to U.S. exporters of LNG, who are riding the wave of strong European demand but may face a slowdown in European purchasing this summer.

HEAT AND STICKY

The temperatures in East Asia have already risen above their long-term averages and are expected continue to rise over the next couple of months.

LSEG data shows that the average temperatures in Japan – the second-largest LNG importer in the world after China in the year 2024 – are expected to be around 6% higher than the long-term mean from now until the end of August.

South Korea, Taiwan and Hong Kong, as well as several Chinese cities, are expected to have similar readings.

The forecasted high temperatures will likely be accompanied by high levels of humidity, as the northern hemisphere's summer coincides in part with Asia's rainy season.

This will in turn lead to a heavy use of air conditioners, which can increase power demand during heatwaves.

GAS HEAVY

Asia's electric producers are accustomed to the rise in summer electricity demand, and they adjust their output levels.

In 2024, the average electricity demand in June, July, and August, the hottest months, was around 9% higher than the average monthly demand for the entire year.

In order to meet the increased demand, utilities have increased output of all power plants, especially fossil fuel ones, which can provide power on demand when renewable energy sources are not producing enough.

Ember data show that the average monthly generation of gas and coal in Asia between June, July, and August, last year, was around 5% higher than 2024's average.

LNG RELIEF

In order to meet the anticipated higher demand for electricity in June, July, and August, Asian LNG buyers tend to purchase more LNG during May, June, and July.

According to Kpler, between 2021 and 2024 the U.S. exports of LNG to Asia in May, June, and July will average around 7,8 million metric tonnes per month.

This compares to an overall average of 2,23 million tons per month for Asia from 2021-2024, and highlights how LNG is a key power fuel in the Asian summer.

PRICE POINT

The price of LNG is a key factor in determining the potential Asian purchase. LNG must compete with coal for power generation, but has been too expensive recently for many Asian consumers.

According to LSEG, the average price of U.S. LNG exported in 2025 has been $8.54 per 1,000 cubic feet, an increase of 35% over the average for 2024.

The price of LNG could fall if Asian LNG sales increase, as European LNG orders tend to decline to their lowest levels in a year.

Kpler data indicates that in the first half 2025, European and Asian markets will account for about 70% of U.S. LNG exported.

The average monthly volume of U.S. LNG shipped to Europe between January and June was around 6 million tonnes, compared with around 1.6 millions tons a month for Asia.

Gas storage operators in Europe will be judged on how quickly they replenish their inventories. They were depleted during the winter, and need to replenish them before next winter.

According to LSEG, the gas stocks in Europe are currently around half full. This compares with around 70% of their capacity at this time next year.

Gas storage operators may choose to replenish as soon as possible. This could mean that Europe's LNG imports will remain strong in the months ahead.

If Europe's storage companies decide to wait until autumn to replenish their stocks or to refill tanks with pipelined supplies, the LNG purchases in Europe could fall sharply.

This sudden decline in European orders will likely lead to a price cut, which in turn will attract new buyers in Asia, where power firms have already been preparing to increase output.

This suggests that the overall U.S. export volumes of LNG should remain relatively robust at least for the near-term, regardless where the buyers reside.

These are the opinions of a columnist who writes for.

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(source: Reuters)