The world's natural gas demand is estimated to fall year-on-year by 2.5% in 2020 down to 3,840 billion cubic meters (bcm), a statement from Rystad Energy said Monday.
Natural gas demand did not decline as much as oil demand, as low prices made gas competitive in the power sector and shielded the share of gas demand from falling further.
While demand in Asia remained relatively strong, European consumption was more severely affected, dropping around 7% year-on-year, or by around 40 bcm, followed by Africa with 26 bcm, the statement said.
Global natural gas production is expected to have dropped by 3.6% last year, as low oil and gas prices led lower exploration and production with the total produced figure hitting around 3,918 bcm in 2020, Rystad Energy said.
The pandemic impacted North America the most as a gas-producing region with production estimated to have dropped by 47 bcm from 2019 to 1,103 bcm in 2020, the statement said.
Liquefaction capacity grew by 5% in 2020, reaching 464 million tons per annum, as new plants, mainly in the US, started operations.
The estimated capacity in the US will reach 71 million tons per annum with a 42% increase with the commissioning of trains at Cameron, Corpus Christi, Elba Island and Freeport, compared to the Russian liquefaction capacity that has reached 29 million tons per annum, the statement said.
“Despite lockdowns, global liquefied natural gas (LNG) imports grew 3% to 363 million tons in 2020. China mainly led the increase in Asian LNG demand at 4% year-on-year.
Other buyers in the region also took advantage of low prices to substitute coal in power," the statement said, adding that European imports remained strong during the first half of the year as buyers nominated less Russian piped gas.
According to the Rystad Energy estimations, global natural gas production is expected to grow by 24% to 4,857 bcm in 2040 with most additions coming from North America.
Global gas demand is set to increase by 26% through 2040 to 4,867 bcm and Asia is estimated to make the largest addition to the demand growth.
By Nuran Erkul Kaya