LNG market growth - a perspective
The LNG market’s robust growth tends to be over-attributed to recent geopolitical events. Examining a few key benchmarks shows the bigger picture - LNG is still relatively small when compared to global gas and coal markets, and even small amounts of substitution lead to strong growth.
Global coal consumption is ~17% larger than global gas consumption.
China’s coal consumption is about 4 times the size of the global LNG market.
Europe’s coal consumption is almost 7 times annual LNG market growth.
LNG represents only about 15% of global gas consumption.
The ~7% annual LNG market growth represents less than 1% of global gas consumption.
LNG’s key attributes - more flexible than pipeline gas, cleaner than coal, enabling dispatchable power solutions through the energy transition - make it attractive despite usually higher cost than coal or pipeline gas.
LNG Training
If you are interested in deepening your understanding of LNG markets and value chains, please consider Arder Energy’s customizable training. We also just published the introductory modules as a standalone “LNG 101” training course via the Udemy platform for flexible, time- and cost-efficient learning.
Sources
Note: slight differences in base years driven by availability of reliable data; impact on conclusions should be immaterial.
Conversion factors: BP Statistical Review of World Energy https://www.bp.com/content/dam/bp/business-sites/en/global/corporate/pdfs/energy-economics/statistical-review/bp-stats-review-2022-approximate-conversion-factors.pdf
LNG Market Size and Growth: EIA, November 6, 2023
https://www.eia.gov/analysis/studies/naturalgas/
Global Energy consumption: EIA World Energy Outlook 2023
China, Europe coal consumption: EIA China / Europe Data Explorer
https://www.iea.org/countries/china, https://www.iea.org/regions/europe