Vitol warns on LNG production shut-ins
The trading house fears that US liquefaction plants may join the list of capacity on the side lines next year
A market’s price is the function of the cost of the most expensive supply required to meet demand. A low price should indicate at least the potential that some of the highest cost supply is ‘out of the money’ and should either shut-in to balance the market or—if it continues producing—utilise storage infrastructure to wait for an oversupplied market to rebalance. So, what is happening in the LNG and global gas markets, where consistently low prices suggest the highest cost producers may be facing this choice? Petroleum Economist spoke to Pablo Galante Escobar, global head of LNG trading at commodity trading heavyweight Vitol, to get his view. We currently have low prices, but we are not see
Also in this section
2 April 2026
Alongside a rapid continued build-out of renewables, China’s latest five-year plan stresses the value of domestic hydrocarbon production for energy security and calls for increased Russian gas imports
2 April 2026
The government is taking important steps to revive domestic production, lift investment and benefit from the geopolitical crisis even if more needs to be done in the longer term
1 April 2026
Golden Pass’s startup offers QatarEnergy a timely boost but may also force a difficult choice between honouring disrupted contracts and capitalising on soaring spot LNG prices
1 April 2026
It is not a case of if or when, but the length and magnitude of economic damage from elevated oil prices
