Global demand for liquefied natural gas (LNG) is expected to climb sharply.
Shell’s LNG Outlook 2025 now forecasts 630-718 million tonnes per year by 2040, this is a higher estimate than last year, driven by rising gas demand for power, industry and transport, particularly in Asia.
Despite growing demand, LNG trade expanded by just 2 million tonnes in 2024, marking the lowest annual increase in a decade.
Supply shortages have slowed the market, with 170 million tonnes of new LNG capacity expected by 2030—but uncertainties remain over when these projects will come online.
Eastern demands
India and China are leading the charge in boosting LNG imports. India is accelerating its natural gas network, aiming to connect 30 million people within five years as demand surges. China is also expanding its gas infrastructure, planning to add pipeline connections for 150 million people by 2030.
LNG is also gaining traction in the shipping sector, with demand forecast to reach 16 million tonnes per year by 2030, a 60% increase from previous estimates.
The fuel is increasingly being used for marine and road transport, offering a lower-emission alternative to oil and paving the way for bio-LNG and synthetic LNG adoption.
Europe’s reliance on LNG is set to continue into the 2030s, balancing intermittent renewables and ensuring energy security. Existing gas infrastructure could be repurposed to import green hydrogen in the future, making LNG a key transition fuel.
US leads exports
On the supply side, the US and Qatar will dominate LNG exports. The US is expected to remain the world’s largest LNG exporter, potentially reaching 180 million tonnes per year by 2030, accounting for a third of global supply.
The market saw significant volatility in 2024. Spot LNG prices fell to their lowest levels since early 2022 before rebounding mid-year due to project delays. Asia drove demand, with China importing 79 million tonnes and India’s imports rising 20% to 27 million tonnes as it battled extreme heat.
Europe, meanwhile, cut LNG imports by 19%, relying more on renewables. But a cold winter, weak wind generation and the expiry of Russian pipeline gas contracts sent prices soaring late in the year.
With gas storage withdrawals high, Europe is set to increase LNG imports again in 2025.
The Shell report underscores LNG’s growing role in global energy security, despite supply challenges and market fluctuations.
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