The latest statistics of the International Gas Association CEDIGAZ indicate that natural gas has pursued steady expansion. CEDIGAZ Survey Natural Gas in the World 2017 confirms the first estimates published early May, showing a 1.6% growth in global gas consumption in 2016, which is in line with the past five-year average. In recent years, the role of natural gas in the energy mix has slightly progressed, against the background of falling coal consumption and rising renewable energy production. Natural gas is expected to pursue similar growth trend in the short and medium term in the context of the energy transition towards an increasingly renewable-based, efficient and sustainable energy system.
Press release - Page 2
NATURAL GAS DEMAND WILL PURSUE ITS SHORT AND MEDIUM-TERM GROWTH TRAJECTORY TO 2035, RISING AT A GRADUAL PACE OF 1.6%/YEAR.
CEDIGAZ, the International Association for Natural Gas Information, has just released its « Medium and Long Term Natural Gas Outlook 2017 ». This scenario, which incorporates national energy plans, highlights the growing role of natural gas as a key transition fuel towards an increasingly renewable-based, efficient and sustainable energy system. In this scenario, natural gas demand is expected to rise by 1.6%/year over 2014-2035 and its growth in absolute terms will outstrip that of all other energy sources. The strong expansion of LNG supply and the abundance of both conventional and unconventional resources will help gas to expand its role in the energy mix to the detriment of coal and oil. In a context of increased globalization of gas markets and diversification of natural gas supply, spot pricing will be a growing component for the commercialisation of gas. Many countries have policies that should favor gas consumption over other hydrocarbon sources, especially in the power sector. Coal-to-gas switching contributes to a strong decline in the future growth of carbon emissions. However, this will not be enough to reach the +2°C target: emissions in the Cedigaz scenario would put the world closer to a +3°C path.
The First Estimates of the International Gas Association CEDIGAZ show a moderate growth of 1.6% in global natural gas demand in 2016
Natural gas consumption grew 1.6% to 3528 bcm in 2016, according to CEDIGAZ, driven by multiple structural and temporary factors. This positive growth is similar to the previous year’s and also in line with Cedigaz short and medium-term natural gas demand forecasts.
These recent developments in natural gas demand illustrate the influence of mixed drivers. More affordable natural gas prices in 2016 have given a boost to natural gas and LNG demand in both industrialized (Europe) and emerging markets. In addition, colder than usual temperatures in the final months of 2016 in the main consuming markets had a strong upward effect on domestic gas sales. Reversely, moderate global economic activity, the decline in energy intensity, weak electricity demand in OECD markets and the strong expansion of renewables are still weakening gas demand growth. If we set climate effects aside, it can be noted that the expansion of natural gas demand has remained below the historical average. In the first three quarters of 2016, it increased at an estimated rate of only 0.5%, relative to the same period of the previous year.