Asia is poised to be the main driver of the anticipated global demand increase for natural gas this year, especially as Europe’s recovery is expected to be sluggish, following a drop to its lowest fuel usage levels in nearly three decades.
According to a report released by the International Energy Agency (IEA) on Friday, global gas consumption is projected to rise by 2.5% in 2024, with the Asia-Pacific region seeing a 4% increase, followed by gas-rich countries in Africa and the Middle East.
Fuel consumption in Europe is forecasted to grow by 3% annually, yet this will remain significantly below the pre-energy crisis levels, which led to a demand reduction across the continent last year, hitting the lowest point since 1995.
While global demand is improving, with prices in Europe and Asia continuing to fall from their peak during the 2022 crisis, the IEA warns of a “high level of uncertainty” overshadowing these forecasts. Geopolitical tensions and recurring extreme weather events could lead to tightened market conditions and price volatility.
The report highlighted Europe’s benefit last year from a record increase in electricity generation from renewable energy, along with a partial recovery in gas usage by industries.
Gas use in the power sector is expected to decrease by about 10% this year, partially offsetting an increase in usage by households and businesses.
The IEA’s projections assume that Russian gas supplies to Europe via pipelines will remain close to last year’s levels, although this situation remains highly uncertain.
Natural gas imports, which reached a record 37% of Europe’s supplies last year, replacing a significant portion of Russian gas, are expected to rise slightly, constrained by limited growth in global capacities this year.
