Australian Gas and LNG Tracker

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• Global exports increase marginally in first half of 2026 despite Qatar outage

• Australia’s LNG exports marginally higher year on year despite falling trend in Chinese imports of Australian LNG

• Redirected US LNG helps Asia manage drop in Qatar imports

• LNG exporters take a larger share of Australian gas as domestic demand falls 

• Victoria continues to export vastly more gas to other states than Queensland

• Global LNG export volumes increased by 0.6% year on year in the first half of 2026 despite a fall of more than 50% in exports from Qatar. This reflected increasing volumes from the US, Malaysia, Russia and other LNG exporters.
• Global LNG imports were virtually unchanged, with growth in smaller markets offsetting declines in both Japan and China. 

• Australia’s export volumes have grown marginally since the first half of 2025, reflecting growth in exports from the Northern Territory (NT).
• Japan remains Australia’s largest export market, accounting for 35% of exports in the first half of 2026, followed by China and South Korea. 
• China’s imports of Australian LNG fell from 16.5 to 9.0 million tonnes (-45%) between the second half of 2021 and the first half of 2026, reflecting falling total import volumes.
• Exports to South Korea, Taiwan and other markets increased in response. Notably, the share of Australian LNG flowing into other markets reached a record high of 14%. 

• Despite expectation that China would be a key driver of LNG demand growth, imports in recent years have been below their 2021 peak. 
• China’s LNG imports in the first half of 2026 were down by almost 25% on the previous six months, and by 8% year on year. 
• The largest driver was a fall in imports from Qatar due to the Iran conflict. 
• It was not compensated by a growth in imports from other suppliers, which were also down from the previous six months. Imports from Australia decreased proportionally with total imports. Only imports from smaller suppliers increased. 

• Japan continued its long pattern of declining demand, with LNG imports declining by 29% since its peak in 2014. 
• In the first half of 2026, Japan LNG imports fell by 5% from the previous six months and 3% year on year.
• Imports from Australia, however, remained virtually unchanged year on year. Australia’s 42% share of the Japanese LNG market was the second highest on record, behind the 43% share in the second half of 2023.

• Asian LNG imports have continued to fall after a peak in 2024. Total imports fell 3% year on year in the first half of 2026. 
• A fall in imports in China and Japan was largely offset by growing imports in South Korea, Taiwan, and Southeast and South Asia.
• Imports from Qatar fell by 56% from the previous six-month period due to the Iran conflict. 
• In response, imports from the US and other countries increased materially. US supply to Asia almost doubled year on year, displacing exports to Europe. 

• The share of Australian gas production being directed to the domestic market reached its lowest level in eight years due to stable LNG export volumes and declining domestic supply.
• In the first half of 2026, domestic supply accounted for 15%, down from 16% a year earlier. 
• Declining domestic supply occurred across Australia, with eastern Australia, the NT and Western Australia (WA) all seeing a fall. 
• Eastern Australia has the largest share of domestic supply at 23%, followed by WA at 15% and the NT at 2%.

• Eastern Australia saw gas consumption falls across major domestic use categories in FY2025-26, with a total drop of 27 petajoules (PJ) – or 6% of total gas use in calendar year 2024.
• The use of gas in electricity generation continued to fall, down by 24PJ in FY2025-26 and by 48PJ since FY2022-23. 
• Similarly, demand from commercial, industrial and residential gas users has fallen by 53PJ in just the past four years, although the rate at which demand is falling appears to be slowing. 
• In contrast, since FY2022-23 LNG exporters have increased their use of domestic gas (to supply export markets) by 17PJ, although the most recent financial year saw a fall of nearly 9PJ. 

• In WA, domestic gas consumption fell on both a six-monthly and year-on-year basis, down by 4% and 6% respectively. 
• Consumption in distribution networks (which supply homes and smaller businesses connected to the network), remained relatively stable, whereas combined consumption among large and ‘other’ gas users fell (the ‘other’ category generally captures smaller gas users [with annual demand below 10 terajoules] not connected to distribution networks). 
• Gas consumption increased among large users, with some compositional differences. 
• Industrial and mineral processors experienced falls in consumption, both on a six-monthly and year-on-year basis. 
• The electricity sector marginally increased gas usage, albeit still below levels in earlier years. 
• Other large users materially increased their consumption. 
• An important caveat, however, is that the Australian Energy Market Operator (AEMO) may periodically reclassify individual large gas users into different categories, which can exaggerate or obscure changes in underlying demand across sectors over time. 

• In FY2025-26, gas flows between Queensland and southern states of eastern Australia were broadly neutral (with Queensland exporting just 2.8 PJ on a net basis), with south-to-north exports in summer nearly compensating for north-to-south flows for winter.
• Net supply from Queensland to the southern states in June 2026 was the lowest in that month since 2021. This likely reflected warmer conditions and reduced heating demand. 
• Net exports from Victoria to other states continued to exhibit a seasonal trend, with exports higher in the summer months as per north-south flows. The overall downward trend reflects the decline in Victorian gas production.