US import tariffs threaten to drive up domestic gas prices

US gas prices have surged 80% year-over-year, and Reuters analysts warn the administration's proposed import tariffs could drive prices even higher.

The agency experts suggest the US natural gas market will face impacts regardless of when new tariffs take effect. Should most trading partners increase gas imports to reduce their trade deficits, demand at LNG export terminals would surge while domestic supplies for other gas consumers shrink. This dynamic would pressure US power utilities reliant on gas for electricity generation.

Surging natural gas prices, driven by record LNG exports, may force a shift back to coal power, potentially reversing emissions progress by increasing atmospheric carbon dioxide levels.

Conversely, if US trading partners reduce gas purchases due to tariff restrictions, demand at LNG export terminals could decline. This would free up supply for domestic consumers, potentially driving down natural gas prices in the US market.