Chemicals company BASF has secured long-term supplies of LNG from Cheniere Energy, the US’s biggest producer of the fuel, with 800,000 tonnes/year to be delivered to Germany from mid-2026 to 2043.

The agreement is interesting in that it signals that, in spite of fears of a “deindustrialisation” of Europe, there is instead a “reshuffling” in the words of an analyst at Eurasia Group. BASF had wound down some of its plants earlier in the year because of high energy prices, and that, along with the investment European firms had been making in manufacturing in the USA because of the Inflation Reduction Act (as well as lower US energy prices), had given rise to the fears. (The price difference is eye watering – according to the Financial Times, the US natural gas benchmark currently trades around US$2.5/million BTU, while the TTF benchmark in Europe is at around US$13/million BTU.)

BASF’s deal adds to two 2.25 million tonne per annum deals already struck between German companies and US LNG producer Venture Global, one by Securing Energy for Europe (formed from the nationalised German arm of Gazprom), and one by utility EnBW.

It continues the reconfiguration of energy trading around the world following the Russian invasion of Ukraine, showing once again that the world changed markedly on the day Russia began its invasion, in a similar way to how Europe turned towards the Soviet Union for energy supplies after the Suez Crisis in 1956.