US Energy Secretary Jennifer Granholm reassured allies on Wednesday that the government’s halt on liquefied natural gas (LNG) exports would not disrupt energy relationships with importing nations.

Maintaining energy relationships

Granholm emphasised that the temporary pause on LNG export approvals, initiated by President Joe Biden in January, would not strain alliances with energy-importing allies. She underscored that the decision aimed to evaluate the environmental, economic, and climate implications of the burgeoning LNG industry.

Duration and scope

While Granholm refrained from providing a specific timeline for the pause, she indicated that it would extend over several months. Senior Biden adviser Amos Hochstein hinted that the freeze could last between 10 to 14 months, possibly extending beyond the November 5 election.

The pause will scrutinise 12 projects but will not affect existing LNG export approvals. Despite the interruption, the US remains the world’s leading LNG exporter, with its export capacity projected to double by 2030 due to ongoing projects.

Strategic petroleum reserve replenishment

Granholm also addressed the gradual replenishment of the Strategic Petroleum Reserve (SPR) following a significant sell-off triggered by Russia’s invasion of Ukraine in 2022. The US is methodically purchasing millions of barrels monthly to restore the emergency stash.

Granholm stressed the importance of ensuring that the replenishment efforts do not disrupt the global supply, particularly during periods of elevated prices. Despite the initial concerns, she noted a significant decrease in prices since the Ukraine invasion.

Why the pause?

The decision to pause LNG exports reflects a broader reassessment of US energy policies under the Biden administration. Concerns over environmental impact, economic sustainability, and climate change have prompted a thorough review of LNG projects’ implications.

The temporary halt aims to address these concerns and align US energy strategies with evolving global priorities, including emission reduction targets and sustainable energy development.

Impact on global energy dynamics

While the pause may temporarily disrupt the LNG market, its long-term implications are significant. By evaluating the environmental and economic ramifications, the US aims to ensure that its energy exports align with climate objectives while maintaining diplomatic ties with energy-dependent nations.

The reassurance provided by Granholm underscores the US commitment to responsible energy practices and collaborative engagement with international partners.

Future outlook

As the pause unfolds, stakeholders will closely monitor its duration and impact on the LNG industry. The Biden administration’s approach to energy policy, including its stance on LNG exports, will shape the trajectory of US energy leadership and its role in global energy dynamics.