Oil & Gas

Europe’s liquefied natural gas (LNG) imports reached their highest levels in nearly a year in December 2024, spurred by early winter cold snaps and heightened energy demand. The region imported 10.89 million metric tons of LNG, a significant increase from November's 8.86 million tons, according to data from Kpler. The surge reflects Europe's effort to replenish gas supplies as storage levels deplete at the fastest rate in seven years, following two milder winters and the cessation of Russian pipeline gas deliveries via Ukraine.

Half of December's LNG imports originated from the United States, marking the highest volume of American LNG arrivals in 11 months at 5.22 million tons. This underscores the pivotal role of U.S. LNG in Europe's energy strategy since Russia's invasion of Ukraine in 2022 disrupted traditional gas flows. Norway has now taken over as Europe’s top pipeline gas supplier, while the U.S. has accounted for a significant share of LNG imports, helping to offset supply disruptions and stabilize the market.

The need for sustained LNG imports extends beyond this winter. With European gas inventories now below the five-year average, countries will need to bolster supplies during the spring and summer to prepare for the 2025/2026 winter. The United States is poised to meet this demand with expanded export capacity from facilities like Venture Global’s Plaquemines LNG in Louisiana and Cheniere’s Corpus Christi Stage 3 in Texas. These projects began ramping up operations in December 2024, contributing to the U.S.’s record-high LNG exports of 8.5 million metric tons in the same month.

Elevated European natural gas prices, driven by a rally in Dutch TTF Natural Gas Futures, have further incentivized U.S. LNG cargoes to flow into northwest Europe. Spark Commodities noted that the price differential effectively closed the arbitrage opportunity for U.S. LNG shipments to Asia, favoring deliveries to Europe instead. As Europe works to fill storage to at least 90% capacity by November 2025, U.S. LNG exporters are positioned for continued growth, with exports projected to rise by 15% in 2025 to nearly 14 Bcf/d, according to the EIA’s Short-Term Energy Outlook.