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(Reuters) – Natural gas consumption by U.S. LNG firms looks set to overtake gas use by U.S. households for the first time in 2025, stoking tensions between the export-oriented LNG sector and domestic gas consumers already saddled with record-high energy bills.
LNG exporters are by far the fastest-growing source of U.S. natural gas demand, with annual gas use by the sector jumping by 140% between 2019 and 2024, data from the U.S. Energy Information Administration (EIA) shows.
That growth pace far exceeded that of all other major gas users and total U.S. gas production over that period, and will result in LNG exporters consuming more gas than both U.S. commercial and residential gas users by the end of 2025.
Given the valuable export revenues generated by the sector, the LNG industry enjoys strong support from U.S. policymakers and U.S. President Donald Trump is pushing for further expansions to U.S. energy exports.
However, households – which have seen energy bills surge to record highs since 2020 as both electricity and gas costs have jumped – are less supportive of the LNG export boom.
If gas costs keep climbing along with LNG exports, consumer pushback against LNG firms that compete for gas with residences could intensify, and could force policymakers to take steps to try to shield households from further gas market cost rises.
GROWING HEFT
LNG export volumes during the opening half of 2025 jumped by around 20% from the year before to a record high of 2.57 billion cubic feet (BCF) of natural gas, according to EIA data.
Residential gas consumers – which includes homes and apartment buildings – collectively consumed around 3.05 BCF during the opening half of 2025, which was around 11% more than the same months in 2024.
The residential gas use total was also the largest for any half-year period since the first half of 2022.
However, household gas use during the second half of the year tends to average around 25% less than first-half gas use due to the colder temperatures that tend to prevail from January through March requiring higher gas-fed heating.
At the same time, LNG exports tend to be stronger in the second half of the year than during the first half, as major buyers in Europe and Asia stock up on gas supplies ahead of their coldest months of the year.
Should those usage patterns prevail again in 2025, LNG exporters will consume more gas than households for 2025 as a whole, and mark a fresh milestone in the scale of the LNG export sector in terms of its total gas needs.
NEW HIGHS
Gas use by commercial and industrial users also scaled record highs during the first half of 2025.
Commercial users – which include offices, grocery stores, laundromats and hospitals – consumed 2.08 BCF, EIA data shows.
Industrial sites – such as chemical plants, fertilizer producers and metals fabricators – consumed around 5.4 BCF.
However, the growth rate of gas consumption by both those sectors was sharply below that of LNG exporters, and means that the total gas share of LNG exporters scaled a new high of 14% so far in 2025.
That compares to an 11% share for commercial users, a 16% share for residences, a 28% share from industry, EIA data shows.
Gas use by the U.S. power sector – the largest gas consumer with a 31% gas use share – declined by around 4% from the first half of 2024 to around 5.9 BCF.
High gas prices during the opening months of 2025 spurred power networks to curb gas use and boost cheaper coal-fired power generation instead.
Higher power output from solar parks, wind farms and other generation sources also allowed utilities to trim gas-fired output so far in 2025.
THE COST OF DOING BUSINESS
U.S. average gas costs remain elevated, with benchmark Henry Hub natural gas futures so far in 2025 averaging around 37% more than their 2024 average.
Those higher gas costs are feeding through to customer utility bills, although residential consumers face by far the highest gas bills among major consumer groups.
Indeed, so far in 2025 residential gas consumers have paid $17.63 per thousand cubic feet, which is roughly five times more than the Henry Hub spot price average of $3.60.
In contrast, power firms have paid around $4.24, industrial consumers have paid $5.07, and commercial users have paid around $11.30, according to EIA data.
LNG firms purchase gas at the Henry Hub spot price, and then face pipeline, liquefaction, storage and transportation costs which vary depending on the supply deals with gas suppliers and the distances that the gas needs to travel.
Households face the highest overall costs due to the extensive infrastructure needed to deliver gas to individual homes, which utilities have provided and need to get paid for.
Residences also consume far lower gas quantities than industrial users, and so are not eligible for bulk volume discounts.
Even so, the sharply higher gas costs for residences are a worsening pain point for households, which are facing sharply higher utility bills along with higher goods inflation compared to just a few years ago.
If gas prices continue to climb as LNG exports rise to fresh records, LNG exporters will likely face fresh criticism about fueling higher domestic energy costs, and possible calls for a slowdown in gas consumption until household prices start falling.
The opinions expressed here are those of the author, a columnist for Reuters.
Reporting by Gavin Maguire; Editing by Sonali Paul
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