September 25, 2020 Read More →

S&P: Natural gas demand likely to fall 2.5 percent in North America over next 10 years

Platts:

Over the next decade, global natural gas demand will grow at a slower pace as the industry responds to emerging financial and policy pressures brought on by the coronavirus pandemic.

A broad slowdown in energy demand caused by the pandemic will bring about an earlier-than-anticipated reckoning for the fossil fuels industry, according to the authors of an energy transition report from S&P Global Platts Analytics and S&P Global Ratings. They predicted an especially bumpy road ahead for gas, even more so than for other fuels.

Global demand for gas will continue growing over the next 10 to 20 years, even outperforming other fossil fuels thanks principally to demand growth from China, India and the Middle East, which together should account for a majority of the global increase in gas demand to 2030. In Western Europe, gas demand will grow just 1.4% to 2030 as the European Union’s Green Deal shifts the continent away from reliance on carbon-intensive fuels, accelerating the phase-out of gas.

In North America, gas demand is forecast to contract 2.5% over the next decade as efficiency gains, fuel substitution and weaker electricity demand cut usage in the power generation and residential-commercial sectors. Modest growth in demand from North America’s industrial sector, fueled by competitively low fuel prices, should at least partially offset contracting demand in other sectors.

“The road to growth is both narrowing and becoming shorter for gas,” said Ira Joseph, head of Global Gas and Power at Platts Analytics and co-author of the report. “Both commercial and policy-driven forces are intervening. One of the ironies for gas is that it has been one of least affected fossil fuels during COVID-19 but will probably be the most affected after.”

[J. Robinson]

More: Coronavirus pandemic to blunt global gas demand growth to 2030 – S&P Global

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