Member Corner
By: Mohammad Amin Naderian
Executive Summary
Since the Middle East conflict began, the most important change in the LNG market has not been the loss of cargoes but the change in what the market expects that loss to mean. This commentary tracks that change through the monthly forecast vintages published between April and October 2026, compared with the pre-conflict forecast of December 2025 (the counterfactual). The central finding is that, within seven months, the market stopped forecasting a temporary outage and started forecasting a structural reshaping of the next LNG cycle. Two signals point to this. First, the shape of the revisions matters more than their size. Second, the expected recovery date keeps moving back: in every vintage, recovery is still a few months away.
The shape of the revisions is the key evidence. A temporary outage would produce large cuts in the first years that fade further out, as the market recovers. The forecasts show the opposite: the revisions grow the further out they go. In the near term, expected 2026 demand fell from approximately 466 to 415 Mt and committed supply from approximately 469 to 419 Mt. Because both fell by similar amounts, the 2026 shortage shows up as consumption priced out of the market rather than as an unfilled volume gap. In the longer term, the expected 2032 surplus rose from approximately 32 Mt in the counterfactual to approximately 97 Mt in the October vintage, around 16% of expected demand that year. The upward revision keeps widening, to approximately 95 Mt in 2034 and 110 Mt in 2035, a year in which the counterfactual had shown a deficit of some 49 Mt. Revisions that grow over time are not consistent with an outage that reverses.
Read full article here: From Outage to Adjustment: How LNG Market Expectations Migrated in the First Seven Months of the Middle East Conflict