Natural gas surpassed coal in the early 2000s and is expected to surpass oil by the mid-2030s, becoming the world’s leading energy source. This transition is primarily driven by environmental factors and local climate conditions, as natural gas has lower carbon emissions and higher efficiency. Extensive pipeline systems and liquefied natural gas (LNG) infrastructure support this change.
Global gas demand in 2023 increased by only about 0.5% compared to the previous year, reaching 4,920 billion cubic meters, mainly due to limited supply. Gas demand is forecasted to rise by about 2% in 2024, reaching 5,200 billion cubic meters around 2026, before stabilizing for three to four years and then declining to 4,420 billion cubic meters by 2050. Over the past decade, natural gas has accounted for about 25% of the total global energy supply and is expected to maintain this share until 2030.
Natural gas demand varies across different sectors, with the power generation sector accounting for about 35% of total demand. Demand from sectors such as construction, manufacturing, and transportation is also expected to rise, although transportation demand is projected to decrease by 2050 due to the adoption of new fuels.
In terms of production and trade, global natural gas production is expected to increase by 1-2% in the coming years, then stabilize until the 2030s before gradually declining. Regions such as the Middle East, North Africa, and North America will be the leading gas exporters. Meanwhile, the demand for imported natural gas will continue to grow in areas with high demand but limited resources, such as China and the Indian subcontinent.
The cost of transporting gas from production regions to consumption areas also affects trade, with LNG increasingly favored for long-distance transportation. LNG’s market share is expected to rise due to its efficiency in long-haul transport. The regasification capacity for LNG is projected to increase by 50% in importing regions like China and the Indian subcontinent.
Source: compiled from DNV Energy Transition Outlook 2024
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