GECF projects gas demand recovery as US-Iran deal eases energy markets

The Gas Exporting Countries Forum projected on Wednesday that global natural gas demand will begin recovering in the third quarter as the resolution of the US-Iran conflict allows energy markets to normalize. GECF Secretary General Philip spoke at a Reuters NEXT Newsmaker event in partnership with LSEG, outlining the forum's expectations for demand growth as the Strait of Hormuz reopens to shipping traffic.facebook+1

The remarks come one week after the United States and Iran signed a memorandum of understanding on June 17 calling for an "immediate and permanent cessation of military operations on all fronts," the reopening of the strait, and the lifting of a US blockade on Iranian ports. The agreement sets a 60-day window for further negotiations on Iran's nuclear program, though both sides have offered conflicting statements about implementation details, including disputes over nuclear inspections.aljazeera+2

Gas Markets Respond to Shifting Fundamentals

Natural gas futures have seen heightened volatility as traders weigh the implications of a post-war energy landscape against near-term demand drivers. Front-month gas futures on the New York Mercantile Exchange settled at a two-week high on June 22, buoyed by rising gas flows to LNG export plants and forecasts for above-average temperatures. Average gas flows to the nine major US LNG export facilities rose to 17.2 Bcf/d in June, up from 17.1 Bcf/d in May.bairdmaritime

The US Energy Information Administration forecasts US LNG exports will average 17 Bcf/d in 2026, an increase of 1.9 Bcf/d from the prior year. Summer heat expectations continue to support underlying physical demand, with above-normal temperature forecasts extending through late June.gascompressionmagazine+1

Analysts See LNG Price Pressure Ahead

Macquarie separately identified LNG as facing lower price expectations, forecasting JKM LNG prices averaging $16.48/MMBtu in 2026 before falling to $12.81/MMBtu in 2027, anticipating rapid market normalization as new supply comes online. The assessment aligns with a broader industry consensus that the global LNG market is transitioning toward oversupply, with approximately 37 million tonnes per annum of new liquefaction capacity slated to enter service in 2026.compressortech2+1

The GECF, whose member countries hold roughly 70 percent of the world's proven natural gas reserves, released its Annual Gas Market Report earlier this year showing global gas consumption reached a record 4.22 trillion cubic meters in 2025. The forum's outlook projects 32 percent growth in natural gas demand by 2050.gecf+2