Analysts say regional market structure is insulating North America even as disruptions in the Persian Gulf drive global price volatility.
By yourNEWS Media Newsroom
Disruptions to global energy supply tied to the ongoing Iran conflict are expected to drive price increases in international markets, particularly in Asia, while leaving U.S. natural gas prices largely unaffected due to structural differences in how gas is traded, according to a report by The Epoch Times.
Market analysts said the U.S. and Canadian natural gas markets remain insulated from global volatility despite the effective closure of the Strait of Hormuz and damage to Qatar’s liquefied natural gas infrastructure earlier in March.
“The price of natural gas in the United States has not been affected because the [domestic] market is ‘shielded’ from international price spikes,” said Ken Medlock of Rice University’s Baker Institute for Public Policy, speaking in comments reported here.
Medlock added that seasonal factors are likely to push North American prices lower as winter demand declines.
The United States is currently the world’s largest exporter of liquefied natural gas, supplying roughly a quarter of global demand, with most shipments directed to European markets. By contrast, Qatar, the second-largest exporter, supplies nearly 20 percent of global consumption, with the majority of its shipments destined for Asian buyers including China, Japan, South Korea, India, and Pakistan.
Following reported damage to infrastructure, QatarEnergy CEO Saad al-Kaabi said repairs could take years, prompting the company to declare force majeure on some contracts for up to five years. Analysts said this suggests rebuilding may be required rather than short-term repairs, limiting export capacity even if shipping routes reopen.
Alex Munton of Rapidan Energy Group said the disruption could significantly reduce LNG volumes leaving the Persian Gulf for years, even after maritime traffic resumes. He noted that while the impact may resemble a major oil supply shock, natural gas markets behave differently due to their regional structure.
“With crude oil, you have a global market and a global price. With gas, you don’t because markets are, to a greater extent, regionalized,” Munton said, explaining that domestic prices in the United States have remained near $3 per MMBtu while international prices have risen.
Medlock said global demand for U.S. LNG would need to increase rapidly to affect domestic pricing, but export capacity remains a limiting factor. “U.S. LNG export terminals were operating at or near capacity prior to the Iran conflict,” he said, adding that the current infrastructure constrains the ability to scale up exports in response to global shortages.
The United States operates eight major LNG export terminals along the Gulf Coast and East Coast, with an additional facility, Golden Pass in Texas, recently beginning liquefaction operations and expected to start shipments soon. Even with expanded capacity, analysts said domestic supply levels are sufficient to prevent significant price increases.
Peter Hartley, also of the Baker Institute, said countries heavily reliant on LNG imports—particularly those without pipeline alternatives—are likely to face the greatest economic impact. He noted that higher energy costs in East Asian manufacturing hubs could translate into broader economic effects, including increased prices for consumer goods.
“Anyone who is an importer is now feeling the pain in higher prices,” Hartley said. “But for countries that don’t import gas—and there are lots of them, the United States is one—the fallout will be less significant.”
Hartley added that while Americans may not see immediate increases in natural gas prices, indirect economic effects could emerge through global slowdowns linked to the supply shock.
Analysts also pointed to the strategic implications of the disruption, noting that the shift toward LNG over pipeline transport—accelerated in recent years by geopolitical tensions—was widely viewed as reducing risk through diversified supply. The current situation, they said, highlights continued vulnerabilities in global energy systems.
Munton described the broader consequences as extending beyond infrastructure damage, raising questions about long-term energy security strategies in key exporting nations.
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