According to the latest edition of the BP Energy Outlook 2035, global demand for energy is expected to rise by 37% from 2013 to 2035, or by an average of 1.4% per year.
Despite the dramatic recent weakening in global energy markets, ongoing economic expansion in Asia – particularly in China and India – will drive continued growth in the world’s demand for energy over the next 20 years.
Spencer Dale, BP’s Chief Economist, commented: “After three years of high and deceptively steady oil prices, the fall of recent months is a stark reminder that the norm in energy markets is one of continuous change. It is important that we look through short term volatility to identify those longer term trends in supply and demand that are likely to shape the energy sector over the next 20 years and so help inform the strategic choices facing the industry and policy makers alike.”
As demand for gas grows, there will be increasing trade across regions and by the early 2020s Asia Pacific will overtake Europe as the largest net gas importing region. The continuing growth of shale gas will also mean that in the next few years North America will switch from being a net importer to net exporter of gas.
The overwhelming majority of the increase in traded gas will be met through increasing LNG supplies. Production of LNG will show considerable growth over the rest of this decade, with supply growing almost 8% per year through the period to 2020. This also means that by 2035, LNG will have overtaken pipelines as the dominant form of traded gas.
Increasing LNG trade will also have other impacts on markets. Over time, it can be expected to lead to more connected and integrated gas markets and prices across the world. It is also likely to provide significantly greater diversity in gas supplies to consuming regions such as Europe and China.
Energy self-sufficiency in North America, which is expected to become a net exporter of energy this year, and increasing LNG trade are also over time expected to have fundamental impacts on global energy flows.
Increased oil and gas supplies in the US and lower demand in the US and Europe due to improving energy efficiency and lower growth will combine with continuing strong economic growth in Asia to shift the energy flows increasingly from west to east.
Bob Dudley, BG Group CEO, concluded: “The energy industry works on strategies and investments with lifespans often measured in decades. This is why an authoritative view of the key trends and movements that will shape our markets over this long term is essential… and is precisely why this Outlook is so valuable.”
Adapted from press release by Katie Woodward
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/17022015/bp-energy-outlook-highlights-lng-growth-265/