In its annual LNG outlook, Shell predicts that the worldwide demand for LNG will increase by over 50% by the year 2040.
The statement explained that the demand for liquefied natural gas (LNG) is projected to increase by over 50% by 2040 on a global scale. This growth is attributed to the increased adoption of coal-to-gas conversion in China and the rising utilization of LNG in countries across South Asia and Southeast Asia to bolster their economic development.
According to Shell, the total amount of liquefied natural gas (LNG) traded worldwide increased to 404 million tonnes in 2023 compared to 397 million tonnes the previous year. Shell predicts that by 2040, the demand for LNG will reach around 625-685 million tons per year.
The company’s report indicates that while gas demand has already reached its highest point in various locations worldwide, the global peak is not expected until after 2040. The United States and Argentina are projected to reach their peak gas consumption in the 2030s, while Russia, India, China, Indonesia, Nigeria, and South Africa will not reach their peak until after 2040.
In Europe and Japan, gas demand reached its peak in the 2010s.
China is anticipated to become the leading force in the growth of LNG demand in the next ten years, driven by the country’s efforts to reduce carbon emissions by transitioning from coal to gas. The steel sector in China, which heavily relies on coal, contributes a larger amount of emissions compared to the combined emissions of the UK, Germany, and Turkey.
Thus, the use of gas plays a vital role in addressing this significant contributor to global carbon emissions and pollution in China. Steve Hill, the Executive Vice President for Shell Energy, expressed this viewpoint.
The company claims that in the next ten years, a decrease in domestic gas production in certain regions of South Asia and Southeast Asia could lead to a rise in the need for LNG. These economies will require more fuel for gas-powered electricity plants and industries. Nevertheless, substantial investments in gas import infrastructure will be necessary in South Asian and Southeast Asian countries.
