Shell Warns of Potential Global LNG Supply Contraction
Disruptions in the Strait of Hormuz could lead to a rare annual supply reduction if they persist through year-end, according to Shell.
Global liquefied natural gas (LNG) supplies could contract this year for the first time in recent memory if disruptions in the Strait of Hormuz continue, according to Shell PLC. However, the energy giant anticipates a return to growth in 2027.
The company's assessment highlights the fragility of global energy flows and the significant impact that geopolitical events can have on supply chains. The Strait of Hormuz is a critical chokepoint for global energy transit, and any sustained interruption poses a substantial risk to the reliable delivery of vital resources.
While a contraction in 2024 is a possibility, Shell's outlook suggests a recovery and subsequent expansion of the LNG market in the following years, indicating a belief that current challenges are likely to be temporary or resolvable.