Global gas demand is expected to see annual growth of 1.6% for the next five years.
That’s according to the International Energy Agency (IEA), which says consumption will reach almost 4,000 billion cubic meters (bcm) by 2022, up from 3,630bcm last year.
The organisation says this will be driven by new US supplies feeding growing demand in developing economies, combined with industry surpassing the power sector as the largest source of demand growth for the first time.
China will account for 40% of global growth as its industrial sector becomes the main source of gas consumption, with renewables and coal taking an increasing share of power generation.
The US will account for 40% of the world’s extra gas production by 2022, thanks to growth in domestic shale. By this time, US production will make up more than a fifth of global output at 890bcm.
The IEA says while US domestic demand for gas is growing, thanks to higher consumption from the industrial sector, more than half of the production increase will be used for liquefied natural gas (LNG) for export.
Fatih Birol, Executive Director of the IEA, said: “The rising number of LNG consuming countries, from 15 in 2005 to 39 this year, shows that LNG attracts many new customers, especially in the emerging world.
“However, whether these countries remain long-term consumers or opportunistic buyers will depend on price competition.”
Investments in the electricity sector exceeded those in oil and gas for the first time last year.