World Economic Forum sessions highlight LNG’s economic, energy security, and climate risks

At the World Economic Forum (WEF) Annual Meeting 2025 in Davos, Switzerland, leading experts examined the economic, energy security, and climate implications of liquefied natural gas (LNG), a fuel often mischaracterized as a “bridge” or “transition” solution in the global energy transition.

Sam Reynolds, LNG/Gas Research Lead, Asia, at the Institute for Energy Economics and Financial Analysis (IEEFA), outlined the economic risks of continued reliance on LNG during two WEF events: a panel discussion moderated by CNN’s Richard Quest, and a press briefing on the risks of LNG expansion.

“Based on dollars and cents, LNG is uncompetitive with renewable energy technologies. It’s unreliable compared to domestically sourced low-cost renewables, and it is not displacing coal in many emerging markets. So, despite what the industry says, relying on LNG is a pathway to energy insecurity, not energy security.”

According to Reynolds, some of the world’s largest LNG markets, namely Europe, Japan, and South Korea, which together account for half of the global LNG market today, are rapidly reducing their reliance on LNG. As a result, the industry is searching for buyers in emerging markets, promoting LNG as clean, affordable, and reliable.

However, cost estimates and life-cycle emissions studies challenge this narrative. For example, in emerging markets like Cambodia, electricity generation from LNG can be up to five times more expensive than some renewable energy options. Even in markets with underdeveloped grid infrastructure, renewables are proving to be cost-competitive with LNG.

On the reliability angle, Reynolds noted that relying on LNG produced in one country, shipped halfway across the world, and re-gasified in the importing market is increasingly untenable in an era of geopolitical uncertainty and escalating climate disasters. A recent IEEFA briefing highlighted that floating LNG import terminals often struggle to operate in severe weather conditions, presenting a critical risk proposition for South and Southeast Asian markets.

“As more LNG supply comes online and the demand picture looks increasingly weak, the investment case for LNG starts to dwindle. There is a serious financial risk in continued investment in a fuel that is going to experience a glut,” Reynolds said.

LNG as a climate and health disaster

Dr. Robert Howarth, a Biogeochemist and Environmental Scientist at Cornell University, emphasized that fossil fuel use is the primary driver of climate change, and the only real  solution is to transition away from them.

“LNG has the largest climate impact of any fossil fuel on Earth. The greenhouse gas footprint of LNG is around a third worse than either coal or regular natural gas. It is the worst, so it’s not a transition or bridge fuel. It’s a climate disaster.”

During the moderated panel, Dr. Howarth highlighted the high global warming potential of methane, the largest component of natural gas. “Methane is a greenhouse gas responsible for a third of all climate warming since the industrial revolution. In the case of LNG, since methane is 80 times more powerful than carbon dioxide as a gas, small methane emissions add up.”

Prof. Tan Sri Dr Jemilah Mahmood, Professor and Executive Director at Sunway Centre for Planetary Health, underscored the devastating health impacts of LNG and fossil fuels. “About eight million people die as a result of air pollution, and we lose US$8.1 trillion a year,” she stated.

“There is an economic value and huge health co-benefits in going to renewables,” she added.

Misleading LNG narratives

Vivek Parekh, Program Manager, Fossil Fuels at InfluenceMap, examined how the corporate sector influences climate policy and highlighted misleading and regionally nuanced narratives about LNG that the industry is promoting. These include claims that LNG is a climate solution, LNG supports energy security, and LNG promotes jobs and economic growth.

He cited findings from the Intergovernmental Panel on Climate Change (IPCC) and the International Energy Agency (IEA) that debunk these narratives. The evidence shows that (1) methane emissions from LNG tend to be highly under-reported, (2) GHG emissions, including methane, exacerbate climate change impacts and undermine long-term energy security, and (3) for developing countries, fossil fuel revenue streams will be severely impacted as oil and gas demand declines through the energy transition.

Climate activist and author Luisa Neubauer noted that the world stands on the cusp of fully adopting renewables. However, she warned that “the fossil fuel industries are jumping in, wanting us to turn around 180 degrees and go back to fossil fuels under a new name with maybe a bit of green feeling to it.”

“Let's distinguish carefully between rigorous greenwashing and real solutions and answers,” she said. “Let’s look at the numbers and what makes us financially, economically, and climate stable. And this is not LNG. LNG is not a bridge technology, it’s a dead end.”