Amazon Web Services AI datacentre in New Carlisle, Indiana
The AI industry’s coming dominance of oil and gas
Tech giants rather than oil majors could soon upend hydrocarbon markets, starting with North America
The leading AI firms plan to spend more than $600b in 2026 as they rush to open datacentres. Speed is everything. Price is no object. Many of the new projects will not be connected to the power grid but will rely on on-site electricity generation, and some 75% of the new facilities will use gas for this. The current forecasts for US gas demand do not account for this recent development. The surge in AI demand could push gas and perhaps diesel and jet fuel prices to new highs. Electric utilities and consumers will likely complain about the increases. US LNG exports will fall as supplies become uncompetitive with gas from countries such as Qatar and Australia, and liquefaction plants in the US
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