Energy leaders at Gastech warn Hormuz deal will not quickly restore global LNG supply
Executives at Gastech 2026 said a Hormuz resolution would lift buyer confidence faster than physical supply volumes can recover.
Top executives at the Gastech 2026 conference in Bangkok said on Wednesday (2026-09-16) that a reopening of the Strait of Hormuz would not be a quick fix for global LNG markets, though some said confidence in the waterway could begin to recover once a resolution was secured.8
Wood Mackenzie estimated that the effective closure removed more than 80 million tonnes per annum of LNG from world markets, equal to roughly 20% of global supply, with Asia bearing the sharpest direct exposure to both lost volumes and resulting price volatility. Asian LNG benchmark JKM stood at $27.76 per MMBtu on Wednesday (2026-09-16).4
The strait was, before the US-Israel war with Iran began in late February 2026, the transit route for about 20% of the world's LNG and oil supplies, IMO secretary-general Arsenio Dominguez told Montel. Dominguez said full reopening would require guaranteed safety of seafarers, and that any payments to Iran for transit would breach maritime law, conditions that leave even a partial resumption timeline unclear.3
LNG's vulnerability to the closure runs deeper than oil's, a gas analyst told Montel on Thursday (2026-05-21). Oil shipments can be rerouted through pipelines; LNG cannot. The closure has tested the limits of LNG's long-held reputation for supply flexibility, with no alternative corridor available for the volumes that once passed through Hormuz.2
Analysts have sketched the potential supply gain from a reopening. Kpler senior LNG market analyst Charles Costerousse told Montel on Wednesday (2026-06-17) that global LNG supply could increase by nearly 2% this year if the strait were to reopen in coming weeks, against just over 1% growth without near-term Middle East flows. Adding the extra 3.1 million tonnes would push estimated 2026 global output to around 435.3 million tonnes, Costerousse said.6
But supply recovery and confidence recovery run on different timelines. Poten & Partners head of business intelligence Jason Feer warned on Wednesday (2026-05-20) that the disruption's impact could last until 2028, even assuming a prompt resolution. Assuming supply remained cut off through the end of August 2026, that year and 2027 combined would require substantial demand destruction of around 38 to 42 million tonnes, or 43.5 to 57 billion cubic metres, globally this year, and up to 20 million tonnes next year, Feer said.1
A single LNG tanker that had been stranded in the Persian Gulf for more than three months appeared in mid-June (2026-06-14) to be navigating toward the strait, the Straits Times reported, after a peace deal raised cautious hopes. One vessel's movement is not a market clearing signal, and the IMO had already made clear that the legal and safety conditions for a full reopening were not yet met. But the episode captured how quickly buyer expectations can shift once a diplomatic framework is in place.5,3
Longer-run supply is being built elsewhere. Wood Mackenzie noted that over 150 million tonnes per annum of LNG capacity is under construction outside the Persian Gulf, much of it in the United States, with a further 30 Mtpa expected to reach final investment decision by end of year. Growing electricity demand linked to artificial intelligence infrastructure, industrial electrification, and coal-to-gas switching continue to support long-run consumption, Yahoo Finance reported.4,7
None of that new capacity arrives fast enough to address the near-term shortfall. US construction timelines measure in years, not months. The Gastech executives drew a clear line between sentiment and supply: a diplomatic breakthrough at Hormuz might shift how buyers approach long-term contracting well before physical flows normalize. The unresolved risk sits with the IMO: guaranteed safety of seafarers and the legal bar on Iran transit tolls must both be cleared before flows can resume, and neither condition was met as of Wednesday (2026-09-16).3,8