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| US LNG exports fell in August due to prolonged heatwaves, forcing domestic LNG power plants to operate at high capacity. (Source: Reuters) |
According to ship monitoring data and analysts' assessments, US LNG exports declined in August 2023. High temperatures and drought affected the Southwestern US last month, leading to record-high electricity demand and forcing suppliers to ask consumers to voluntarily reduce their consumption.
Natural gas supplies to the seven largest U.S. LNG exporters fell from 12.7 billion cubic feet per day in July to an average of 12.3 billion cubic feet per day in August, significantly lower than the record high of 14 billion cubic feet per day in April.
According to preliminary data from the US market tracking platform LSEG Eikon, US natural gas production increased from 102.1 billion cubic feet per day in July to 102.2 billion cubic feet per day last month. However, very high demand from gas-fired power plants, particularly in Texas, has depleted fuel reserves.Additionally, the temporary shutdown for maintenance has limited LNG processing at Cheniere Energy's two facilities in Louisiana and Texas. Analysts predict that the volume of U.S. natural gas being shipped to LNG export plants will rebound in September as the facilities resume normal processing speeds.
According to preliminary data from LSEG Eikon, there were 102 shipments departing from US ports last month, carrying 7.32 million tons of LNG – slightly lower than the 7.51 million tons shipped in July.
The primary destination for US LNG is Europe, which receives approximately 52% of US LNG exports, followed by Asia with 30%, and South America and the Caribbean with 7%.
Notably, many ships are avoiding the Panama Canal, where a prolonged drought has forced restrictions on daily shipping volumes. Consequently, some LNG tankers that choose to pass through the Panama Canal are now experiencing wait times of up to three weeks.
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