Math Says Buy The Dip. The Jones Act Says Buy LNG

The 106-year-old law that's holding back American energy

Mar. 30, 2026 at 4:09pm

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The Jones Act, a 106-year-old law that requires all goods shipped between U.S. ports to be carried on American-built, American-owned, and American-crewed vessels, has become one of the most costly and counterproductive regulations in the U.S. economy, particularly when it comes to energy. The U.S. builds almost no commercial ships, and there's not a single LNG tanker that fully meets Jones Act requirements, meaning the U.S. can export LNG to other countries but can't transport it domestically. This paradox has led to higher energy costs for Americans and created investment opportunities in LNG producers and shippers.

Why it matters

The Jones Act has stifled innovation and competition in the U.S. shipbuilding industry, leading to a small and expensive fleet of vessels that can't even serve America's own energy needs. This has had significant consequences for U.S. consumers and businesses, who often pay more for energy than their global counterparts. However, the recent 60-day waiver of the Jones Act and the global supply disruptions in the LNG market have created potential investment opportunities in the energy sector.

The details

The Jones Act was supposed to guarantee a domestic market for American-made vessels, but instead it has created a closed system of artificially expensive ships with no competitive pressure to innovate. The U.S. accounts for only 0.04% of global commercial shipbuilding, while China, South Korea, and Japan dominate the market. Operating a U.S.-flagged ship is roughly four times more expensive than an internationally flagged one, and building ships domestically costs at least four times more than in other nations. This has resulted in a fleet so small and costly that it can't even serve America's own energy needs. For example, the U.S. is the world's largest exporter of liquefied natural gas (LNG), but there's not a single LNG tanker that fully meets Jones Act requirements, meaning the U.S. can export LNG to Europe, Asia, and elsewhere, but can't transport it from the Gulf Coast to New England or Puerto Rico.

  • The Department of Homeland Security issued a 60-day waiver of the Jones Act in 2026 to address supply chain disruptions caused by Operation Epic Fury.
  • The U.S. became the world's largest natural gas exporter in 2025, with LNG exports surging to 8.9 trillion cubic feet that year.

The players

Cheniere Energy

A company that has committed more than $50 billion to build and expand its Gulf Coast LNG terminals, with production capacity expected to potentially exceed 100 million metric tons per year by the mid-2030s.

Venture Global LNG

A company that Goldman Sachs has identified as being best positioned to benefit from the disruptions in the global LNG market.

Golar LNG

A company that Goldman Sachs has identified as being best positioned to benefit from the disruptions in the global LNG market.

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What’s next

Whether or not the Jones Act suspension leads to permanent reform is a political question that remains to be seen. However, the investment implications seem clear, with LNG producers, exporters, and shipping companies poised to benefit from the global supply gap and record shipping rates.

The takeaway

The Jones Act has become a major impediment to the U.S. energy industry, artificially inflating costs and preventing the efficient domestic transport of resources like LNG. While the recent waiver provides temporary relief, the broader issue highlights the need for policy reforms that can unlock the full potential of America's energy dominance and protect consumers from higher prices.