IEA (2018), "Gas 2018", IEA, Paris https://www.iea.org/reports/gas-2018
The gas industry’s future remains bright. Three major shifts will shape the evolution of global natural gas markets in the next five years – growing imports from China, greater industrial demand, and rising production from the United States.
The structural shift will determine the evolution of the market at a time when growth in emerging markets is sustained by strong economic expansion and strong policy support to curb air pollution. Industry becomes a major player in gas markets, while the United States cements its position as a top producer and exporter thanks to its shale revolution.
Gas 2018, the latest IEA annual market report, assesses these trends and provides a detailed analysis of supply and trade developments, infrastructure investments, and demand-growth forecast through 2023.
The report analyses the main changes that will likely transform the natural gas market, including market reforms that shape supply and demand patterns in key Asian economies and developments in the LNG market – the main driver of interregional natural gas trade growth.
Deep transformations are underway in natural gas markets – China is entering the global gas scene, driven by continuous economic growth and strong policy support to curb air pollution; the United States is emerging as a global LNG player; and the industry sector is set to take over from power as the key driver for natural gas demand.
Gas 2018 explores these structural shifts and other trends that are set to determine the evolution of the market over the next five years.
China is set to dominate rising gas demand...
... driven by demand from industry
Industry also drives demand growth around the world
The United States is set to account for the largest share of supply expansion – and the main contributor to export growth. Meanwhile Europe’s dependency on imports increases, leading to potential competition between traditional suppliers such as Russia and new sources of supply, mainly from LNG.
Oil driven production provides the bulk of output growth in the US, with supply sustaining both domestic markets and export growth.
LNG drives growth in global gas trade…
The current wave of LNG export capacity development is due online by the end of 2020. In the short run, this massive capacity addition will increase competition – however this could be short-lived with dynamic growth in Asian emerging markets. Without new investment, the continuous growth of the LNG trade could result in a tight market by 2023. Owing to the long lead time of such projects, investment decisions need to be taken in the next few years to ensure adequate supply through the 2020s.