Growing FSRU Demand Expected to Help Balance LNG Surplus Later This Decade

A wave of new LNG supply that’s expected to push global natural gas prices lower later this decade is likely to spur additional investments in floating storage and regasification units (FSRU) that could ultimately help to balance any glut.

FSRUs are faster to deploy than building larger onshore terminals to import liquefied natural gas and come at a far lower cost. The scramble to secure energy supplies since Russia invaded Ukraine in 2022 and upended global gas flows has increased utilization of the vessels, prompted orders for new ones and created long wait times for those in operation.

“It is evident that these vessels have been developed and deployed at a faster rate than in the past,” said RWE AG freight analyst Rupesh Mulwani. “The urgency brought on by recent geopolitical events has driven this accelerated pace.”