Russia’s invasion of Ukraine in 2022 led to a global energy crisis, causing oil and gas prices to soar in Europe and the U.S. Many Americans faced difficulties paying their bills, leading to a spike in utility disconnections.
Energy experts now fear that the Trump administration’s recent military actions against Iran could trigger similar events. Qatar has halted operations at the world’s largest liquefied natural gas facility. This facility plays a key role in storing and transporting natural gas globally. Shipments through the Strait of Hormuz, a critical trade route, have been cut off, affecting 15% of the global oil supply and 20% of global LNG.
As a result, prices for oil, gasoline, and diesel have risen, and natural gas prices in Europe are surging. Analysts at Wood Mackenzie noted the conflict is disrupting global gas and LNG markets more than oil. Asian markets are most affected, but Europe is also experiencing panic.
The scale of the disruption hasn’t reached that of Russia’s attack on Ukraine, but experts warn it could escalate. “If this continues for a full week, we might be on a similar trajectory,” said Clark Williams-Derry, energy finance analyst for the Institute for Energy Economics and Financial Analysis. He added that prolonged conflict could lead to higher natural gas prices for consumers.
The Ukraine conflict caused a “massive transfer of wealth” from households to fossil fuel providers, Williams-Derry stated. The current Iran crisis highlights issues with increasing U.S. LNG exports without policy guardrails, he pointed out. As the U.S. exports more LNG, domestic prices become more linked to global market fluctuations. “U.S. consumers are competing with global consumers for the same gas,” he added.
LNG proponents argue that exports bolster energy security for American allies, reducing reliance on countries like Russia. Rob Jennings of the American Petroleum Institute stated that U.S. LNG exports enhance energy security amid geopolitical uncertainty. Though domestic demand rises, he noted that domestic production growth has outpaced exports, minimizing domestic price impacts.
Even before the Iran conflict, U.S. natural gas prices were expected to rise due to increased demand from LNG facilities, according to the U.S. Energy Information Administration.
As over 40% of U.S. electricity is generated from natural gas, electricity bills are also impacted. States reliant on this fuel, like Pennsylvania, Delaware, Mississippi, Florida, and Louisiana, feel the changes acutely.
Since 2016, U.S. LNG exports have surged, driven by the fracking boom. The U.S. is now the world’s largest LNG exporter, surpassing Australia and Qatar. The Trump administration prioritized increasing LNG exports, reversing a pause on new projects. Several new LNG facilities are set to launch soon.
“Last year, the eight LNG export terminals used more gas than all 74 million gas-powered households,” noted Tyson Slocum, director at Public Citizen. The organization estimated Americans paid $12 billion more for natural gas in the first nine months of 2025 compared to 2024.
On the 10th anniversary of the first U.S. LNG export, the Department of Energy praised Trump’s efforts to “accelerate export capacity.” LNG exports support jobs and prosperity domestically and internationally. Recently, Energy Secretary Chris Wright approved expansion at a Texas LNG facility.
Senators, including Elizabeth Warren and Bernie Sanders, criticized this policy, citing rising utility prices. They noted increased earnings for some LNG companies.
The conflict with Iran exacerbates the financial strain on Americans struggling with utility bills amid a cold winter and high demand from data centers. Nationwide electricity rates rose by 5% in 2025, with Pennsylvania seeing a nearly 9% increase.
Overall, Pennsylvanians paid 46% more in 2025 compared to 2018. Elizabeth Marx of the Pennsylvania Utility Law Project stated the price hikes are causing significant hardship. Pennsylvania has recorded “record” numbers of utility disconnections, similar to the Great Recession era.
Marx highlights the “explosion” of LNG export capacity since 2016 as a major factor in rising costs for Pennsylvania households. Despite being a major natural gas producer and electricity exporter, Pennsylvania faces increasing prices due to LNG exports.
While the long-term impact of the Iran conflict is uncertain, the U.S. oil and gas sector is already benefiting. Some LNG facilities stand to profit significantly from rising natural gas prices, leading to what Williams-Derry describes as a “gold rush.”
He further commented on the industry’s strategy, “I’ve often described the oil and gas industry’s financial strategy as ‘pray for war,’ as it is how they maximize profits.”
Original Story at insideclimatenews.org