One of the drivers for oil falling to $50 a barrel is the fact that the world is entering the Golden Age of Natural Gas. Although oil is the primary energy source for transportation, natural gas is the most efficient low-carbon energy source for electricity, industrial production, and home heating. With the U.S. price of natural gas about 30% of the cost in Asia, huge specialized ships will soon be transporting LNG from the U.S. to displace a large percentage of diesel oil used for electrical generation and transportation in Asia.

Compared to the U.S. price of natural gas at $3.14 per thousand cubic feet (mcf), natural gas price contracts in Asia are trading at $10 to $12 per mcf due to high demand and insufficient natural gas supply in the region. The main components driving up natural gas demand in Asia are 10% annual electricity growth and rising demand for the industrial sector to shift from diesel oil to gas. China has increased natural gas use by almost 600% since 2000, according to the BP annual review.

The United States has been the world’s largest producer of oil and natural gas combined, passing both Russia and Saudi Arabia by producing the equivalent of 25 million barrels of oil in October 2013, according to the Energy Information Administration. The U.S. rise to dominance has been fueled by new drilling techniques, such as horizontal drilling and hydraulic fracturing, which have unlocked vast quantities of oil and gas from shale rock formations – especially in North Dakota and Texas.

Natural gas is a slightly cheaper energy source than oil products, but it is a radically cleaner burning fuel. About 75% of China’s electricity production comes from coal-fired plants. During the three hottest months of the summer, China suffers the world’s worst smog due to lignite coal burning release of sulphur oxide, nitrogen dioxide, and carbon dioxide. China’s goal is to increase natural gas as percentage of total energy needs go from 2.5% to 8% in the next five years, which means demand will quickly triple.

LNG is natural gas that, when cooled (liquefaction) to minus -259 degrees Fahrenheit, becomes a clear, colorless, odorless liquid that is neither corrosive nor toxic. Primarily methane, LNG is low in carbon dioxide, nitrogen, oxygen, and sulfur pollutants.

The first LNG tankers were built by the Russians in 1969 to support their Siberian and Arctic activities. There currently are 394 LNG tankers operating, and 75% are less than ten years old. East Asia is by far the world’s largest market, mostly driven by Japan.

The current economic costs per one mcf of LNG are about $1.10 for the liquefaction, $.20 for pipeline delivery, $0.70 for tanker and export handling, and $0.35 for import regasification. Add the current U.S. price of $3.14 for natural gas and the total is $5.49.

Australia encouraged huge investments to build seven LNG terminals that will open between now and 2017. With 86 billion cubic meters (bcm) of LNG capacity, Australia expected to overtake Qatar to become the world’s largest LNG exporter. But several Australian projects are massively over budget. With Chevron’s Gorgon LNG price-tag skyrocketing from $37 billion to $54 billion, several Australian terminals will never open.

Three years ago with natural gas selling at $12 mcf in China, the economics looked good to take $7 mcf Australian conventional natural gas and export it as LNG. At the time, Sino Gas agreed to sign a contract for LNG, an equivalent discounted price of $9.50 per mcf, according to Reuters. But with Australia’s Queensland Curtis LNG terminal loading its first cargoes on January 7, any new 25% contractual volume discount off the current $10 mcf price in China makes future Australian LNG exports unprofitable.

But with the America’s shale gas revolution as a source of $3 or less natural gas for export, the United States has dozens of proposed LNG terminals planned. Stratfor believes that many of these proposed terminals are unrealistic, but the U.S. could easily reach 50 to 100 billion cubic meters of natural gas volume for export very soon.

Industrial consumers of natural gas in Japan, Taiwan, China, and South Korea are the world’s four largest LNG buyers. Their industries are now at a huge comparable disadvantage to America’s cheap natural gas for industrial feedstock and power. Importing cheap LNG from the U.S. will not “trigger” a countrywide recovery in Japan or reverse China’s economic rebalancing, according to Stratfor. But LNG exports will continue to drive the American shale revolution and dramatically improve the United States balance of payments over the next decade.