Can Natural Gas Demand Sustain Its Current Pace?

Some experts have predicted a slowdown in use and production and sales of natural gas

The US Energy Information Administration projects a 50 percent rise in global natural gas consumption between 2010 and 2035, with growth in Brazil and China driving increased demand. Source: ucsusa.org

(SALEM, Ore.) - Coal is no longer king and has not been for a long time. Natural gas surpassed coal as the primary generator of electricity in the U.S. back in 2003 and has not looked back since.

Globally, the demand for natural gas grew by 4.6 percent back in 2018. The biggest drivers for the growth included a healthy economy, varying weather conditions, and continued movement away from coal use around the world.

Potential Slowdown

A reduced oil and natural gas rig fleet could also impact the production and sale of natural gas. Rig counts at the end of May were down to 1,061, a drop from a November 2018 high of 1,299 rigs. Lower supplies of natural gas can make it difficult for natural gas to continue matching or exceeding the growth levels of recent years.

Suppliers and Consumers

They are looking for a quick turnaround in their air quality and benefit from the clean burning and efficiency of natural gas.

Still, China’s use of natural gas is expected to grow by only eight percent over the next five years. That is a significant change from growth rates of 14.5 percent and 18.1 percent in 2017 and 2018, respectively.

Other parts of the world that should continue contributing to the growth of natural gas include Africa, the U.S., and the Middle East. They will continue to benefit from an investment in making abundant supplies of cheap energy available for use by power plants and other industries. The U.S. is being looked at to meet continued demands thanks to increased production from shale fields.

Inventory Outlook

Ongoing Demand

While there may be some questions around whether natural gas can continue growing at its current pace, the current market does not yet reflect any real signs of a slowdown. It remains to be seen if the industry can continue the innovation necessary to keep the processing of LNG at the necessary capacity.

Predictions regarding the growth of natural gas consumption are difficult due to the variety of factors that play a part in the growth levels. As detailed earlier in this article, some experts have already predicted a slowdown in the use of natural gases and a slowdown when it comes to the production and sales of natural gas. There has been a lot of volatility in the natural gas market over the year and it seems that demand from Asia will power the growth of this industry from years to come according to expert predictions. This growth could be fueled for the next five years with strong gas consumption growth having been noted in a number of countries within Asia. It has also been noted that there have been a number of recent reforms within major markets, and these could have a profound impact on growth levels.

At present, the signs that experts have noted have been viewed as encouraging but many have been quick to point out that more data action may be needed in order to ensure market driven development of natural gas can be sustained within these markets. In addition, further investment LNG projects will prove essential in helping to drive growth. Source: Salem-News.com Special Feature Dept.