HomeNewsIEA: Global gas markets to remain tight on rising demand

IEA: Global gas markets to remain tight on rising demand

1/21/2025

Global natural gas markets will remain tight this year as demand rises and output grows more slowly than before the energy crisis of 2022 and the pandemic of 2020-2021, a quarterly report by the International Energy Agency (IEA) said on Tuesday.

Gas price volatility has been stoked by political factors, including uncertainty around the energy policies of U.S. President Donald Trump and the potential for disruption of Middle Eastern supplies.

Although the stoppage of Russian pipeline supplies to eastern Europe via Ukraine on Jan. 1 has yet to lead to a shortfall for the European Union, cold weather means Europe is set to end the winter season with below-average gas stocks, increasing demand for global liquefied natural gas (LNG).

Gas demand, especially in Europe, fell in 2022-2023 as prices soared after Russia's invasion of Ukraine and measures by the EU to reduce consumption curbed the use of Russian supplies.

Last year, global gas demand grew by 2.8%, or 115 billion cubic meters (bcm), compared with the 2% average growth rate between 2010 and 2020.

At the same time, liquefied natural gas (LNG) output grew at less than the average rate, the IEA report said.

The Asia-Pacific region accounted for almost 45% of incremental gas demand in 2024 due to economic growth.

This year, growth in global gas demand is forecast to fall back below 2%. Again, Asia is expected to lead consumption and to account for a similar amount of demand as last year, the report said.

Global LNG supply grew by 2.5% (or 13 bcm) in 2024, below its average growth rate of 8% between 2016 and 2020, due to project delays and feedgas supply issues. It is expected to grow 5%, or just over 25 bcm, in 2025 as large LNG projects start or ramp up, mostly in North America.

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