Liquefied natural gas (LNG) is becoming one of the most important fuels in the global energy transition. Demand is rising fast, driven by Asia’s growth, energy security concerns, and the need for lower-carbon alternatives to coal and oil.
Here’s what investors need to know.
An overview of the LNG market
LNG demand is expected to grow more than 60% by 2040, and a small group of large, well-capitalized energy companies are in the best position to benefit.
The best LNG stocks combine:
- Long-term supply contracts
- Massive infrastructure already in place
- Strong cash flow and dividends
Top LNG stocks to consider
These seven publicly traded companies give investors the clearest exposure to global LNG growth.
| Name and ticker | Market cap | Dividend yield | Industry |
|---|---|---|---|
| ConocoPhillips (NYSE:COP) | $150.2 billion | 2.63% | Oil, Gas and Consumable Fuels |
| Cheniere Energy (NYSE:LNG) | $56.7 billion | 0.78% | Oil, Gas and Consumable Fuels |
| ExxonMobil (NYSE:XOM) | $634.9 billion | 2.64% | Oil, Gas and Consumable Fuels |
| Shell Plc (NYSE:SHEL) | $248.6 billion | 3.25% | Oil, Gas and Consumable Fuels |
| TotalEnergies (NYSE:TTE) | N/A | N/A | Oil, Gas and Consumable Fuels |
| Chevron (NYSE:CVX) | $380.4 billion | 3.62% | Oil, Gas and Consumable Fuels |
| Energy Transfer (NYSE:ET) | $68.6 billion | 6.64% | Oil, Gas and Consumable Fuels |
1. Cheniere Energy
NYSE: LNG
Key Data Points
2. ConocoPhillips
NYSE: COP
Key Data Points
3. ExxonMobil
NYSE: XOM
Key Data Points
NYSE: SHEL
Key Data Points
5. TotalEnergies
NYSE: TTE
Key Data Points
NYSE: CVX
Key Data Points
Chevron is a major player in the global LNG market. It operates the Gorgon and Wheatstone LNG projects in Australia, making it a major LNG supplier to Japan. It also owns an interest in Angola LNG, one of the largest energy projects in Africa and the first LNG project in Angola. Additionally, the company operate the Leviathan gas field offshore Israel, including a floating LNG terminal.
In addition to operating LNG facilities, Chevron has contracts to buy LNG from several third-party terminals along the U.S. Gulf Coast. Starting in 2026, its LNG contracts will enable it to export 7 million metric tons of LNG per year from the U.S. Gulf Coast.
7. Energy Transfer
NYSE: ET
Key Data Points
Energy Transfer had been trying to develop Lake Charles LNG for over a decade. While the pipeline company suspended development of the project in late 2025, it remains open to discussions with third parties interested in developing it. Energy Transfer decided to stop working on Lake Charles LNG to focus on its large backlog of natural gas pipeline infrastructure projects.
LNG is a big driver of demand for space on Energy Transfer's vast gas pipeline infrastructure. For example, Energy Transfer is building the $2.7 billion Hugh Brinson Pipeline to transport more gas from the Permian Basin to the U.S. Gulf Coast, which is benefiting from robust LNG demand. Growing LNG demand could boost volumes across Energy Transfer's existing pipelines and support new expansion opportunities.
Why LNG demand is growing
Natural gas is abundant, flexible, and cleaner than coal or oil. The challenge is transportation. LNG solves that problem by cooling gas into a liquid that can be shipped worldwide.
Key demand drivers include:
- Rapid economic growth in Asia
- Efforts to cut emissions in heavy industry and power generation
- Energy security concerns in Europe
- Rising electricity needs from data centers and AI
Benefits and risks of investing in liquefied natural gas stocks
Investing in LNG stocks has its pros and cons. Some of the benefits include:
- Growth potential: Demand for LNG is on pace to grow 60% by 2040.
- Dividend income: LNG facilities tend to generate stable cash flow backed by long-term contracts. As a result, many LNG producers pay high-yielding and steadily rising dividends.
- Lower carbon: LNG is a much lower-carbon fuel compared to coal and oil.
Meanwhile, some of the risks of investing in these stocks include:
- Overinvestment: Several companies are either building or have proposed to build new LNG export terminals around the world. If the industry builds too many facilities, it could cause LNG supplies to outpace demand, weighing on pricing and investment returns in the sector.
- Commodity prices: LNG prices can be volatile. That can reduce the cash flows of LNG production not secured by long-term, fixed-rate contracts. It can also cause companies to delay LNG expansion projects.
- Cost overruns: LNG projects are costly and take a long time to build, increasing the risk of cost overruns that can reduce returns.
Future outlook of LNG
The world's economies will need a growing supply of cleaner fuels in the decades ahead to help combat climate change. Due to its abundance and lower carbon emissions when burned, natural gas appears poised to provide a significant share of that supply. LNG gives it the global access needed to reach key markets, including energy-hungry Asian nations.
According to Shell's forecast, LNG demand will rise by 60% by 2040. That fuels the belief that LNG stocks could do exceptionally well in the coming years as global demand grows.
How to Invest in Liquefied Natural Gas Stocks
Here's a step-by-step guide on how to invest in LNG stocks:
- Open your brokerage app: Log in to your brokerage account where you handle your investments.
- Search for the stock: Enter the ticker or company name into the search bar to bring up the stock's trading page.
- Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this stock.
- Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
- Submit your order: Confirm the details and submit your buy order.
- Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.
Key Trends in the LNG Industry
The following trends are driving the LNG industry:
- The war with Iran is disrupting the flow of LNG out of the Persian Gulf, driving up prices.
- Economic growth in Asia is a key long-term driver of LNG demand.
- AI is emerging as a potential demand accelerator, as data centers are using natural gas to power AI chips.
- Efforts to cut emissions are another factor driving demand for cleaner-burning natural gas.
Related investing topics
FAQ
LNG FAQ
About the Author
Matt DiLallo has positions in Chevron and ConocoPhillips. The Motley Fool has positions in and recommends Cheniere Energy and Chevron. The Motley Fool recommends ConocoPhillips. The Motley Fool has a disclosure policy.
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