The world production of natural gas fell by 3.6% – to 3,918 bcm last year
This was facilitated by low prices for hydrocarbons, which, in turn, led to a decrease in exploration and production, according to a report by Rystad Energy.
Despite the quarantine restrictions, the low prices made natural gas competitive in the energy sector and prevented a larger decline. Global consumption of natural gas amounted to 3,840 bcm (-2.5% by 2019) last year.
While demand in Asia remained relatively high, gas consumption in Europe fell by about 7% (-40 bcm). This is followed by Africa with a fall in consumption by 26 bcm.
Liquefied natural gas production capacity grew 5% to 464 million tons per year in 2020. LNG demand in Asia grew 4%, mainly driven by China. In the first half of last year, European imports remained high as suppliers offered less Russian pipeline gas.
In 2040, world natural gas production will grow by 24% – up to 4,857 bcm, Rystad expects. At the same time, most of the growth will fall on North America (+410 bcm to 2020), Russia (+190 bcm) and the Middle East (+185 bcm).
Against the backdrop of aggressive environmental policies and the growth of renewable energy sources, the demand for natural gas in Europe by 2040 will decrease by 43 bcm compared to 2020. The US demand will be threatened by a new environmental policy that the Biden administration is expected to announce.
The world’s natural gas liquefaction capacity is expected to almost double by 2040, reaching a total of 886 Mtpa (+ 91% to2020).
Note that the day before, the spot gas price jumped to $ 284 per 1,000 cubic meters (+10% per day).