LNG

Optionality, not just molecules, is what LNG buyers are scrambling for as spare capacity shrinks and shipments from Qatar remain constraint. As sources for ‘safe’ supply become finite, each new shipping disruption has a greater impact on prices and procurement decisions, analysts warn.

Through 2030, global electricity consumption will grow at least 2.5 times as fast as overall energy demand, the International Energy Agency (IEA) forecasts, with emerging Asian economies accounting for near 80% of incremental electricity and related LNG demand to fuel gas peaking power stations.

Soaring LNG trade flows from the US and Canada have offset around 70% of the lost supply via the Strait of Hormuz, though further military escalations in the region and delays in restoring Qatari exports keeps could prolong market tightness into 2027, the International Energy Agency (IEA) warns.

Weaker industrial activity and high LNG prices have slowed global gas demand markedly in 2025, the International Energy Agency (IEA) finds. Gas demand in the power sector grow by less than 1%, due to high spot LNG prices, improved nuclear availability in Asia and continued renewables growth.

The European Commission is considering introducing gas price caps, enhanced power purchase agreements (PPA) or contracts for difference (CfD) to shield industry and households from soaring energy costs caused by the halt in Middle Eastern LNG deliveries.

Bridging the cost gap between green and grey hydrogen will require public grants and operating subsidies – impacting LNG demand growth. Displacing half of current fossil-based hydrogen (H2) with low-emissions alternatives would reduce associated gas needs by up to 150 bcm per year, equivalent to 6% of global gas demand, the International Energy Agency (IEA) finds.

Prices for fossil fuels and clean energy technologies are falling as overcapacity builds. “Oil prices have already come under pressure (…) and the same will soon be true in natural gas markets, as the wave of new LNG export projects start operations,” said Fatih Birol, executive director of the International Energy Agency (IEA).

Asian economies take advantage of falling LNG prices by switching from gas- to coal-fired generation. “Around 30% of the 380 billion cubic metres (bcm) of gas demand growth has come from coal-to-gas switching since 2010, and virtually all of this happened in China," the International Energy Agency (IEA) finds.

Southeast Asia’s LNG imports are set to soar from 35 bcm today to 135 bcm by 2035, primarily driven by Pakistan and Bangladesh, the International Energy Agency (IEA) forecasts. With a wave of new LNG export capacity coming to market, global gas prices are bound to ease substantially, empowering countries like Bangladesh to secure long-term LNG contracts at more competitive rates.

As global oil demand levels off, a “wave of new LNG exports” is putting downward pressure on prices and extends natural gas demand growth into the 2030s, the International Energy Agency's (IEA) 2025 World Energy Outlook finds.