Gas 2020
Executive Summary
- Demand Shock: 2020 saw the largest recorded demand shock in global natural gas markets due to the COVID-19 pandemic, leading to a 4% drop in consumption.
- Market Impact: The already weakened market faced significant declines due to mild temperatures, lockdowns, and economic downturns.
- Geographical Impact: Europe was the hardest-hit region, with a 7% year-on-year decline. Mature markets in Europe, North America, Asia, and Eurasia accounted for about 75% of lost gas consumption.
- Sectoral Impact: Power generation was the hardest hit, accounting for half of the total demand decline, followed by residential and commercial sectors, and the industrial sector.
2019 - Cool Down
- Growth Slowdown: Natural gas consumption growth slowed in 2019, increasing by only 1.8% year-over-year.
- Key Markets: The U.S. and China were the main drivers, though both returned to single-digit growth rates.
- China: Economic growth slowed to 6.1%, while natural gas demand grew at 8.6% (down from 18.1% in 2018).
- Regional Growth: South Asia saw significant growth driven by higher LNG deliveries to India and Bangladesh. South East Asia also experienced growth in natural gas consumption.
- Declining Regions: Russia and South America saw decreased consumption due to low economic growth and reduced domestic production.
Key Data Points
- 2020 Demand: Expected to fall by 4% due to the pandemic and economic downturn.
- 2021 Recovery: Natural gas demand is expected to recover gradually, but the crisis will have long-lasting impacts.
- 2025 Outlook: Projected to lose 75 bcm of annual demand by 2025, equivalent to the 2019 global increase.
- Emerging Markets: Growth expected in Asia, particularly China and India, supported by strong policy measures.
- Supply: Incremental gas production from U.S. shale and large conventional projects in the Middle East and Russia.
- Trade: Liquefied natural gas remains the main driver of global gas trade growth, but faces risks of prolonged overcapacity.
Conclusion
The report provides a comprehensive analysis of recent natural gas market developments, assessing the impact of the COVID-19 crisis and discussing the main drivers and uncertainties affecting future supply and demand until 2025.
