Asian Heatwaves Boost LNG Demand, Shift Cargoes from EU to Asia

The global liquefied natural gas (LNG) market is experiencing a notable shift in demand and trade patterns in 2025. The European Union remains the largest LNG importer, increasing its imports by 18.5% year-on-year in the first half of 2025, largely driven by efforts to diversify away from Russian pipeline gas, with the U.S. emerging as the largest LNG exporter. Meanwhile, in Asia, a severe heatwave across northeast Asia, including Japan, South Korea, and North Korea, has boosted cooling demand, pushing Asian spot LNG prices higher and prompting cargoes initially destined for Europe to be redirected to Asia. This surge in demand has led to increased spot purchases in Japan, with utilities like JERA seeking additional LNG for August and September, supported by higher power prices and tight supply conditions in early August. However, industrial demand in China remains subdued amid economic factors such as inflation and import tariffs, which could influence future demand. The LNG market in Europe is stabilizing, with competition to secure cargoes for storage ahead of winter continuing, while the Asia-Pacific region remains an attractive market due to elevated temperatures and power demand.