Liquefied natural gas prices — which have surged since the start of the US-Iran war — are unlikely to drop in the short term, according to Chevron Corp.’s Australia president. “I have a hard time seeing the prices come down” in the next six months or so, Balaji Krishnamurthy said in a Bloomberg TV interview on Monday. “Australian LNG is at a premium now,” given how geographically close it is to Asia, he said on the sidelines of the Gastech conference in Bangkok. The US oil major, which runs the Gorgon and Wheatstone projects in Australia, has benefited as prices have surged due to the loss of exports from Qatar, which used to produce around a fifth of the world’s LNG. That’s also resulted in some demand destruction in the short term, however, and there’s also a risk of lower consumption in the longer term as countries look for alternatives to future-proof themselves from supply shocks.

The rise of artificial intelligence would be a key source of demand growth for LNG, and there were opportunities for data centers in Australia, Krishnamurthy said. The war had also resulted in customers increasingly seeking long-term supply contracts as energy security is now top of mind, he added. “In the short term, we will continue to see some demand adjustments,” Krishnamurthy said. But “in the long term, the fundamentals, particularly for LNG, still remain very strong,” he said.