LNG recovery in Asia depends on China, India policies
The latest International Energy Agency (IEA) report on the global natural gas market makes sombre reading, especially for current and would-be producers of the super-chilled version of the fuel.
No doubt much of the commentary on the report, issued on Wednesday, will be around the headline forecast that global natural gas demand will drop by 4 per cent, or 150 billion cubic metres (bcm) in 2020 as consumption takes a hit from the economic impact of the novel coronavirus.
The IEA forecasts a gradual recovery in demand in 2021 and 2022, but the impact of the coronavirus will be long lasting, increase uncertainties and dampen growth rates.
What recovery is there is in demand is likely to be led by liquefied natural gas (LNG) and will be led by Asian countries, the IEA said.
This may sound encouraging for the LNG industry, but there are some caveats around the IEA’s forecasts for Asia.