The International Energy Agency says the massive expansion of natural gas production is having wide-ranging effects on the global liquefied natural gas balance by underpinning major investments in new liquefaction capacity despite low gas prices in both Europe and Asia.
“China, India and other developing Asian markets account for most of the increase in global gas trade. By 2040, Asia consumes one-quarter of the world’s gas production, much of it sourced from other regions,” said the IEA. In its World Energy Outlook, the Paris-based research body said China will be importing almost twice as much LNG as the next largest importing country, India, and the share of gas in China’s energy mix rises from 7 percent today to 13 percent by 2040.
Demand growth for both LNG and pipeline gas consumption will continue in China where it increased by 33 percent in the past two years. On the supply side, the United States will add nearly 200 billion cubic metres to global natural gas production by 2025, over half of which is destined for export.
Demand for gas to grow four times faster than oil
Over the next two decades, global demand for natural gas grows more than four-times faster than demand for oil. “Natural gas sees broad-based growth across the energy economy, in contrast to oil where growth is concentrated in parts of the transport sector (trucks, shipping and aviation) and petrochemicals,” explained the IEA report.
Developing Asian economies account for half of the global growth in natural gas demand and almost all of the increase in traded volumes. China overtook Japan as the largest gas-importing country in 2018 and its imports are projected to reach the level of the entire European Union by 2040.