Strait of Hormuz Closure Puts Shell's 2026 LNG Trade Forecast at Risk
The Strait of Hormuz closure has cut roughly 20% of global LNG supply since February, exposing European storage margins and pressuring Shell's flat-2026 trade forecast.
Global LNG trade volumes hit a record 56.3 billion cubic feet per day in 2025, a 5.4% rise year-on-year, driven largely by a 26% surge in U.S. exports to 15.1 Bcf/d, according to data from the International Group of Liquefied Natural Gas Importers published by the U.S. Energy Information Administration on July 14 (2026-07-14). Those gains are now under pressure. Qatar's LNG exports, which climbed 3% to 10.6 Bcf/d in 2025, have been curtailed since the Strait of Hormuz closed on February 28 (2026-02-28), removing roughly 20% of global supply, EIA data show.7
Shell had built its 2026 trade outlook around a conditional. In its tenth annual LNG Outlook 2026, published June 30 (2026-06-30), the company said traded volumes could still match 2025's 422 million metric tonnes — but only if Hormuz shipping normalizes "this summer," as reported by Rigzone. It is now August 9 (2026-08-09). The strait remains closed.6,1,5
The most direct consequence is a spot-market collision between Asian and European buyers. Asian importers absorbed over 80% of Qatari LNG volumes in 2025; those flows are now absent and cannot easily be replaced from within the region, EIA data show. European buyers competing to refill storage ahead of winter are bidding for the same cargoes. JKM, the Asian spot benchmark, stood at $21.11 per MMBtu on August 9 (2026-08-09), while ICE Endex TTF front-month gas was at €55.50 per MWh on the same date.7
Asian LNG imports have already fallen. Arrivals across Asia in the first half of 2026 dropped nearly 4% to 127.70 million tonnes compared with the corresponding period of 2025, analytics firm Kpler data show. Reuters reported that analysts expect higher prices to continue curbing South Asian demand, with buyers diverting to coal or domestic gas where available.1
Shell's long-run projections, published in the same June 30 (2026-06-30) Outlook, point toward far higher demand by mid-century. Global LNG demand is forecast to reach nearly 700 million tonnes a year by 2050, an increase of around 65% from 2025 levels, with Asia as the primary engine, Shell said. South and Southeast Asia are expected to account for roughly 40% of global imports by that date as economies switch from coal to gas and data centre power demand adds persistent load.4,3,1
The structural case rests on a supply gap forming in emerging Asia. Domestic gas production in those economies is expected to fall even as demand expands, leaving the region needing around 300 million tonnes of LNG per year by mid-century, Shell projected. About 180 million tonnes per year of new supply is forecast to enter the market by 2030, which Shell says should improve affordability and stimulate demand in markets not yet active importers.1,3
Europe occupies a different position in Shell's demand map. European gas demand will plateau through 2030, rather than decline as earlier forecasts suggested, because the energy transition is proceeding more slowly than expected, Shell told Montel on June 30 (2026-06-30). LNG will play a growing balancing role in European supply during that period. But Shell expects European gas demand to fall after 2030, making the continent a ceiling market rather than a growth one in its long-run model.2
The U.S. has stepped into the supply gap left by Qatar. American LNG shipments accounted for 26% of global traded volumes in 2025, up from 21% in 2024, with the U.S., Qatar and Australia collectively holding 63% of global exports, up from 60% in 2024, EIA data show. Russia moved in the other direction: its LNG exports fell 8%, or 0.4 Bcf/d, in 2025, the largest volumetric decline of any exporter, as EU sanctions stemming from the Ukraine invasion reduced European offtake. Shell's own LNG sales rose 11% to 72.9 million metric tonnes in 2025, according to the company's annual report.7,6
Whether 2026 trade ultimately matches or falls short of last year's level hinges on how quickly Qatari cargoes return to market. If Hormuz flows do not normalize before autumn, European utilities heading into the winter storage season will face tighter spot availability and sustained JKM competition for cargoes. The 180 million tonnes of new annual supply expected by 2030 may eventually ease that competition — but it offers nothing to buyers who need to fill tanks before November.6,5,1