Record high prices in natural gas continue to affect some of the biggest global importers and exporters of LNG. Many emerging economies in Asia, also big LNG importers, have been taking back some orders because of surging prices. The prices have increased five folds within the year. North American exporters fear for a long term drop in demand.

Many growing economies of Asia, including India, Pakistan and China, have viewed natural gas and LNG as a good source to reduce carbon emissions. As a result of the latest price surge in gas, many countries tend to return to coal and fuel oil. Moreover, they have been rethinking whether it’s a good idea to maintain new LNG investments.

Asian countries account for 70% of global LNG imports. Some countries like India, Pakistan and Bangladesh are particularly exposed to spot LNG prices, which have soared to a record $50 per million British thermal units (mmBtu). The high prices cause some Southeast Asian developers to rethink LNG investments.

Although US LNG exporters were initially happy with the price increase, volatility makes their lives harder too, especially in terms of signing long term contracts. Both the US and Canada have new LNG projects; but they don’t look likely to start operating in the short term.