The routes of interdependence

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outheast Asia, long dependent on fossil fuels, is now pivoting toward renewables. Many nations in the region have set carbon-neutral targets, with near-term goals of cutting coal use. To ease the shift, they are turning to liquefied natural gas (LNG) as a cost-effective bridge fuel within broader transition strategies. Thailand and Vietnam are investing heavily in LNG to safeguard energy security while advancing climate ambitions. At the same time, leading exporters such as Indonesia and Malaysia are seeing rising domestic demand and have begun importing LNG themselves.
 

Southeast Asia’s LNG flows are becoming increasingly tied to the United States, now the world’s largest exporter. In 2024, 33 percent of U.S. LNG exports went to Asia, primarily to Japan, South Korea, India, and China. While the region has traditionally relied on nearby suppliers, Southeast Asian countries are now looking to the U.S. both to offset President Donald Trump’s reciprocal tariffs and to bolster domestic energy security. This article will examine the LNG landscape in Malaysia, Indonesia, Thailand, and Vietnam, and explore how imports from different suppliers shape transport and storage across the region.

Malaysia

Malaysia is Southeast Asia’s largest LNG exporter and the fifth largest globally. Positioned on the southern edge of the South China Sea and bordering the Strait of Malacca, it sits at the heart of vital maritime energy trade routes. As of 2023, the country operated six liquefaction terminals and two regasification terminals. In 2025, state-owned Petronas announced plans for a third regasification facility, while a floating LNG vessel under construction near Sabah is slated for completion in 2027.
 

With its strong LNG infrastructure, Malaysia—through Petronas—supplies markets worldwide. In July 2025, Petronas marked the successful shipment of its first LNG cargo from its new Canadian facility to Japan. The company also plans to expand exports beyond its main buyers in Japan, China, and South Korea, targeting new markets in Southeast Asia, including Vietnam and the Philippines.
 

Although already an LNG hub, Malaysia’s energy demand is rising at 6.5 percent annually. To keep pace, the country is leaning more on LNG to bolster domestic reserves and is even weighing additional imports. As part of this strategy—and to help narrow Malaysia’s trade deficit with the United States—Petronas pledged to buy $3.4 billion worth of U.S. LNG each year. Prime Minister Anwar Ibrahim, however, has emphasized that Petronas will import only what is necessary to meet domestic needs.

Indonesia

Indonesia is the world’s seventh-largest LNG exporter and the second largest in Southeast Asia after Malaysia. Its main customers are South Korea, Japan, and China, though in recent years it has lost market share to competitors such as the United States, Malaysia, Qatar, and Australia. The country currently operates three liquefaction plants and six regasification terminals.
 

Like Malaysia, most of Indonesia’s LNG is exported abroad, leaving the country struggling to secure its own energy supply. To address this, Indonesia is gradually shifting from diesel to LNG and has asked overseas buyers to accept shipment delays so it can meet domestic needs first. State-owned PLN EPI is also pursuing a $1.5-billion project to distribute LNG on a small scale across the archipelago using a hub-and-spoke system. The main challenge is balancing supply with the high infrastructure costs of delivering small volumes to regasification plants. To safeguard both its export market and domestic security, Indonesia may need to boost imports and is already weighing additional purchases from the United States. In April 2025, it announced plans to consider importing $10 billion worth of LNG and crude oil from the U.S. to help close its trade gap.

Thailand

Thailand is relying more heavily on LNG imports to secure its long-term energy future. With domestic gas reserves expected to run out within 20 years, the country is expanding storage capacity to a planned maximum of 26 million metric tonnes per annum (mmtpa) by 2037. It currently operates two regasification terminals, both owned by state-run PTT Public Company Limited (PTT). A third import terminal, developed by the private firm Gulf Development at Map Ta Phut Port, is slated to open in 2029. 
 

Thailand is gradually expanding LNG imports from the United States and its partners. PTT already holds long-term supply agreements with companies such as Shell and BP, and in 2025 the country signaled stronger interest in U.S. LNG as a way to narrow its trade surplus with Washington. In April, Finance Minister Pichai Chunhavajira confirmed an agreement to import one million metric tonnes of U.S. LNG worth $500 million starting next year, as part of a 15-year plan totaling 15 million tonnes. He also noted that another contract—covering more than one million tonnes valued at about $600 million over five years—is under discussion. In May, Thailand announced it is weighing imports of up to five million tonnes annually from Alaska.

Vietnam

Vietnam’s Power Development Plan 8 sets ambitious energy goals, positioning LNG as a transition fuel. It projects peak import capacity of 13.2 mmtpa in 2030, declining to 8.8 mmtpa by 2050. The plan also calls for 13 new LNG power plants by 2030, with a priority on sourcing fuel from Southeast Asian suppliers such as Malaysia, Indonesia, and Brunei. Vietnam currently has two LNG terminals. The first, operated by Petrovietnam Gas (PV Gas)—a subsidiary of state-owned Petrovietnam—has imported more than 300,000 tonnes of LNG on a spot basis. The second, Cai Mep LNG, is a joint venture between Singapore-based Atlantic, Gulf and Pacific LNG (AG&P LNG) and Vietnam’s Hai Linh Company.
 

Vietnam is weighing greater imports of U.S. LNG as a way to narrow its trade gap with Washington. Prime Minister Pham Minh Chinh underscored the need to boost purchases in a recent government meeting, while PV Gas signed supply agreements with U.S. firms Excelerate Energy and ConocoPhillips. The strategy reflects Vietnam’s goal of relying on the United States for steadier LNG deliveries to meet rising demand and offset declining domestic resources.
 

Japan, with its well-established LNG ecosystem, has become a key investor in Vietnam’s market. In 2024, a consortium of Thai, Vietnamese, and Japanese energy companies began developing the Block B gas field off Vietnam’s coast. The project—including upstream development, pipeline construction, and onshore power plants—is valued in the billions of U.S. dollars. Beyond Block B, Tokyo Gas is partnering with Thai Binh LNG Power (TBLP) JV to build a 1,500 MW LNG power plant and a floating import terminal off the coast of Thái Bình province.
 

Vietnam has also begun importing LNG from Russia. After the two countries signed a nuclear energy agreement in January 2025, Russia offered to supply LNG, delivering its first shipment less than six months later. The move comes against the backdrop of EU sanctions over the Russia–Ukraine war, which initially sent LNG prices soaring as Southeast Asian buyers competed with Europe for U.S. cargoes. While Russian LNG offers Vietnam another source of supply, it carries the risk of U.S. retaliation. President Trump has already doubled tariffs on India—raising them by an additional 25 percent—after its purchase of Russian oil. Given Vietnam’s priority of maintaining strong ties with Washington, it is unlikely to scale up LNG imports from Russia in the near future.

Geopolitical chokepoints and maritime security concerns

As all four countries deepen their reliance on both Southeast Asian and U.S. LNG, they also expose themselves to geopolitical chokepoints that could disrupt trade across the region.
 

The most significant potential obstacle lies in the South China Sea, a vital trade corridor for LNG in Southeast Asia. Rising tensions there are increasingly shaping how U.S. LNG is distributed throughout the region. Washington has long been involved in the dispute, supporting countries such as Vietnam and the Philippines in strengthening their military capabilities to safeguard shared maritime interests. But if tensions with China escalate, the route could be disrupted—blocking LNG shipments not only from the United States but also from regional suppliers such as Malaysia and Indonesia.
 

Another potential chokepoint for LNG distribution is the Gulf of Thailand, which borders the South China Sea. The gulf and its resources have long been contested by neighboring states such as Cambodia, Vietnam, and Malaysia. The sharpest tensions lie between Thailand and Cambodia, fueled by territorial disputes that shift with each Thai administration. A recent border clash has only heightened the strain. Although the two countries agreed to an unconditional ceasefire, tensions remain unresolved, leaving the risk that disputes in the gulf could disrupt LNG flows to the region.

Towards a transformation of flows

Rising dependence on LNG has brought a surge in imports from the United States. Southeast Asian nations view U.S. LNG as a way to narrow trade gaps with Washington, particularly under the shadow of President Trump’s reciprocal tariffs. Yet this reliance also fuels unease about America’s geopolitical role in Asia. Tensions in the South China Sea threaten critical LNG routes, and the Trump administration’s unpredictable stance leaves the durability of U.S. supply uncertain. With Russia now entering the market as well, the global flow of LNG into Southeast Asia may be poised for significant change.