Global gas markets are poised for major changes by the end of this decade, with a new wave of liquefied natural gas (LNG) production capacity expected to transform market dynamics, according to the latest edition of the IEA’s Medium-Term Gas Market Outlook.
Gas 2025 offers a comprehensive overview of potential supply, demand, and trade trends in global natural gas markets over the coming years.
The report provides a detailed review of recent market developments ahead of the 2025–26 Northern Hemisphere winter and includes forecasts for how supply and demand could evolve through 2030.
According to the report, around 300 billion cubic metres (bcm) per year of LNG export capacity — a record — is set to be added by 2030, primarily driven by liquefaction capacity expansions in the United States and Qatar.
Over 80 bcm of annual LNG liquefaction capacity has already been sanctioned in the United States this year — an all-time high for the US LNG sector.
This unprecedented global expansion is expected to strengthen supply security and ease market pressures following a period of tightness.
Although gas markets have gradually rebalanced following the supply shock triggered by Russia’s invasion of Ukraine in 2022, prices remain well above historical averages. This has restrained demand, especially in price-sensitive Asian markets. Global gas demand growth is forecast to slow from 2.8% in 2024 to below 1% in 2025.
However, the report projects that the surge in liquefaction capacity will translate into a potential net LNG supply increase of 250 bcm per year by 2030. Barring unexpected disruptions, this expansion is expected to lower prices in the coming years and stimulate higher demand.
“The coming LNG wave is set to offer some respite for global gas markets, which have been tight and volatile for several years. As new supply comes to market, notably from the United States and Qatar, it should apply downward pressure on prices – offering welcome relief for gas importers worldwide,” said IEA Director of Energy Markets and Security, Keisuke Sadamori. “But elevated geopolitical tensions and economic uncertainty mean there is no room for complacency. Global cooperation remains essential to ensure supply security – especially with rising electricity consumption set to drive gas demand higher in many regions.”
In the report’s base case, natural gas demand is projected to rise by nearly 1.5% annually between 2024 and 2030, representing an increase of 380 bcm in absolute terms.
The Asia-Pacific region is expected to account for half of this growth, while the Middle East — where countries such as Saudi Arabia are shifting from oil to gas for power generation — would contribute nearly 30%.
In a high-case scenario, which explores how a sharper decline in LNG prices could spur additional demand growth, particularly in the Asia-Pacific region, global gas use could increase by as much as 1.7% annually through 2030 — representing over 65 bcm per year of additional demand on top of the base case.
At the same time, a prolonged period of lower LNG prices could dampen the incentive for project developers to invest in new capacity, potentially leading to a tightening of global gas markets after 2030 if demand continues to rise strongly.
As part of its detailed annual analysis of global supply security, the report also reviews recent contracting trends, noting that the global LNG market is becoming increasingly liquid and flexible. Destination-free contracts are projected to account for just over half of total LNG volumes contracted by 2030.
The report further highlights the potential for deploying carbon capture technologies along LNG value chains to reduce the emissions intensity of supply. It also includes a section on the medium-term outlook for biomethane, low-emissions hydrogen, and e-methane.
Discover more from Energy News Africa
Subscribe to get the latest posts sent to your email.