HOUSTON — U.S. LNG exporters on the Gulf Coast warn their profits are shrinking as Henry Hub natural gas climbs above $5 per million BTUs and Europe’s Dutch TTF drops below €30 per megawatt-hour. This narrower gap threatens profits from LNG exports to Europe and could put some shipments at risk. Exporters say slimmer margins make it harder to cover costs such as liquefaction, fuel, and shipping, reducing the incentive to send more cargoes.
According to a Reuters analysis, the TTF–Henry Hub spread has narrowed to about $4.70 per MMBtu, the slimmest margin since 2021, and analysts warn that if it sinks below $2, some U.S. LNG cargoes may no longer cover tolling and freight costs. That leaves many U.S. LNG marketers increasingly dependent on long-term contracts and hedging strategies to keep trains running at high utilisation rates even as spot profitability fades.
Europe’s Dutch TTF benchmark has dropped to around €28 per MWh, roughly 41% lower than a year ago, according to data from Trading Economics, as high storage levels, mild weather and rising LNG inflows weigh on prices. U.S. LNG sellers who built portfolios around the much wider spreads of the immediate post-Ukraine crisis now face thinner netbacks on spot cargoes to Northwest Europe, especially once shipping and regasification fees are factored.
Structurally, the squeeze comes just as a wave of new U.S. LNG capacity is starting to come online. The U.S. Energy Information Administration estimates that North American LNG export capacity will more than double to 24.4 billion cubic feet per day by 2028, with about 9.7 billion cubic feet per day of that growth in the United States alone, reinforcing the country’s role as the world’s largest LNG exporter. Timera Energy has already flagged that futures-based TTF-Henry Hub spreads for the 2025–26 winter have shrunk to about $4.8 per MMBtu, a sharp fall from more than $10 the previous winter, signalling lower forward returns for U.S. LNG compared with recent years.
Today’s profit crunch also fits into a longer arc for U.S. LNG. Just a year ago, a Reuters column republished by Natural Gas World highlighted how a roughly $11 per MMBtu Henry Hub-TTF spread was “signalling bumper profit potential” for U.S. exporters as Europe scrambled to replace Russian pipeline gas. Earlier, in December 2024, an essay by analyst Art Berman warned that U.S. LNG had become a “global power play” that risked pushing domestic gas prices higher as export capacity expanded faster than production. Looking even further back, a 2021 Investing.com report chronicled how LNG-driven demand helped drive Henry Hub futures above $5.60 per MMBtu, underscoring that U.S. LNG has long been tightly linked to domestic price cycles.
For now, U.S. LNG flows remain robust. In November, U.S. LNG exports reached a record 10.9 million metric tons, with roughly 70% of cargoes headed to Europe even as TTF prices slid. This shows that contracted volumes continue to move despite thinner spot economics. However, if Henry Hub holds near or above $5 while TTF stays in the high € 20s, traders say flexible cargoes could be redirected to higher-priced Asian or Latin American markets, or even left in storage.
In response, U.S. LNG sellers and European buyers are adjusting portfolios to preserve margins in an increasingly crowded global gas market.
