Markets are falling as war escalates – but not every industry is affected

The conflict in Iran is hurting millions of people – bills are rising and energy markets are in decline.

But a distorting effect of war is that some industries do well: that’s how our global financial system works, as certain sectors, like energy, can thrive amidst turmoil while others suffer.

In this case, a group of American energy companies would benefit.

“U.S. liquefied natural gas (LNG) exporters are clearly the near-term winners,” says Tom Purdy, chief LNG analyst at Energy Aspects.

Why? Well, the struggle has created a hole in the market, and there is something about these companies that puts them in a prime position to bridge that gap, such as their ability to quickly ramp up production and secure long-term contracts with buyers in Europe and Asia.

The Ras Laffan plant on the northeastern tip of Qatar typically produces about a fifth of the world’s LNG (liquefied natural gas) – gas that has been cooled to make it easier to transport via ships, in this case through the Strait of Hormuz.

But Qatar said it has been done, forced to close the plant because airstrikes fly overhead and effectively stop shipping.

Enter the US: thanks to the recent shale gas revolution, it is now the world’s largest exporter of LNG.

But what really sets it apart in this context is that it has a relatively high proportion (10% to 15%) that is not already tied into long-term contracts.

That leaves these companies free to sell on the spot market to the highest bidder – and sending prices rising by as much as 50% in European and Asian markets in the first week of the conflict.

Qatar has said its plant would likely remain offline for up to four weeks even if the conflict now ends. This puts the US LNG industry on track for a $4 billion windfall in the first month of the conflict, according to a model from Energy Flux.

“The most suitable source for additional supply is the United States,” says Energy Flux founder and analyst Seb Kennedy.

“So LNG exporters, their customers, and the customers who pick up cargo from them and then sell them into end-use markets – those players will be in line for a windfall from the war. Iran.”

He said, “It is always the case that when there is a supply shock, companies that preside over excess supply are always rewarded by the market.”

key players

This upside appears to be already pushing up the valuations of some key players.

Venture Global sells substantial amounts of gas outside traditional contracts and last week said it was “ready” to help maintain supply in the markets.

Its share price rose 28% in the first week of the fight (although it was also boosted by a court ruling on an issue relating to its ability to sell spot cargo).

Cheniere Energy, a smaller spot market company, still enjoyed an 8% rise, although it said it was already almost sold for 2026.

It declined further comment, while Venture Global and US trade body Center for LNG did not respond to requests.

cuts both ways

But it’s worth pointing out the same flexibility that now allows it to sell at higher prices on both sides.

When prices fall, those companies make losses.

And right now U.S. LNG exporters can’t even come close to filling the gap left by Qatar.

Meanwhile, LNG exporters from other countries will also step in and make profits.

And in the long term, the “winners” are those countries that can supply LNG with unobstructed shipping routes, Matthew Utting, chief natural gas and LNG analyst, told Sky News.

“Countries like Australia, Canada, Peru, western coastal Mexico, and Argentina benefit the biggest picture, because they have LNG that stays within the Pacific basin and does not go through choke points.”

not quite plain sailing

It is not all straightforward for the industry in America. Some have had their supplies of LNG (liquefied natural gas) from the Gulf disrupted.

The disruption of oil supplies has also led to a rise in gasoline prices in the US, particularly among drivers who are accustomed to low prices and sensitive to any increase.

US President Donald Trump is now considering offering insurance coverage and naval escort to help get the tankers out of the Gulf.

Mr. Trump has always aimed to promote “American energy dominance,” which refers to the goal of the United States to achieve self-sufficiency in energy production and to be a leading energy exporter. This conflict has nothing to do with it, but there are a handful of companies that are helping it so far, such as those involved in energy production and maritime security, which are indirectly supporting the goal of American energy dominance.