Global Energy Company Shell released the latest LNG Outlook 2025, which provides a comprehensive analysis of global LNG trade trends, pricing movements, and the fuel’s growing role in marine transportation and energy transition strategies. With LNG increasingly recognized as a vital component of energy security and decarbonization, the report offers valuable insights for the bunkering industry.
Global LNG Market Trends
In 2024, global LNG trade reached 407 million tonnes, marking a modest increase of 3 million tonnes from 2023. However, this represents the lowest annual supply addition in the last decade. The report highlights a divergence in regional demand, with Asia experiencing significant growth while Europe saw a sharp decline in imports.
- Asian Demand Surge: China capitalized on lower LNG prices, importing 79 million tonnes in 2024—a 6-million-tonne increase from the previous year. India also saw record LNG imports at 27 million tonnes, driven by a scorching summer that boosted power demand.
- European Decline: European LNG imports fell by 23 million tonnes (19%) due to strong renewable energy output and continued weak industrial gas demand.
- U.S. Export Expansion: The U.S. solidified its position as the world’s largest LNG exporter, though growth is accompanied by potential regulatory, cost, and geopolitical risks.
LNG’s Role in Marine Fuel and Energy Transition
LNG remains a critical fuel choice for shipping, offering immediate cost and environmental benefits. The report underscores its contribution to lower emissions in hard-to-electrify sectors and the broader decarbonization of maritime transport.
- Methane Emission Reduction: The industry is making strides in curbing methane emissions, with members of the Oil and Gas Climate Initiative (OGCI) cutting upstream methane intensity by over 50% since 2017. Efforts are underway to achieve near-zero methane emissions by 2030.
- Liquefied Biomethane and Synthetic Gas: The increasing role of liquefied biomethane and liquefied synthetic gas (LSG) in transportation is emphasized, with existing LNG infrastructure capable of supporting these alternative fuels without additional investment.
- Infrastructure Expansion in Asia: Rising LNG consumption in China and India has spurred infrastructure investments, including new regasification terminals and storage capacity.
Market Volatility and Future Supply Growth
LNG prices remained volatile throughout 2024, influenced by unexpected weather patterns, supply disruptions, and geopolitical uncertainties. Despite a temporary stabilization, the market anticipates significant supply growth, with over 170 million tonnes of new LNG capacity expected by 2030. However, near-term supply remains constrained, with major additions not expected until late 2025.
For the bunkering sector, the growing reliance on LNG underscores its increasing role in shipping decarbonization. With investments in infrastructure and regulatory support, LNG is set to remain a key marine fuel option amid the global energy transition.
FAQs on Global LNG Market Trends and Developments
1. What are the key factors driving LNG demand growth through 2040?
Global LNG demand is projected to rise through 2040 due to several factors:
- Expanding economies in Asia, particularly China and India
- Decarbonization efforts in heavy industries and transportation
- Increasing energy consumption from data centers and the tech sector
- LNG’s cost-effectiveness for shipping and road transport
2. How did LNG prices fluctuate in 2024, and what influenced them?
LNG prices saw fluctuations throughout 2024, remaining below the highs of 2021-2023. Key factors impacting pricing included:
- A mild winter in Q1, leading to opportunistic buying in China
- Record summer heat in India, increasing LNG demand for power generation
- Delays in new LNG plant construction and declining domestic production in Egypt
- Concerns over Russian pipeline supply and lower European gas storage levels, causing market volatility in Q4
3. How did LNG supply growth in 2024 compare to previous years?
2024 marked the lowest LNG export capacity growth in a decade, with only 3 million tonnes of new supply added. This limited expansion resulted from:
- Gas production declines in key regions
- Construction delays in major LNG projects
4. How did LNG import trends differ between Asia and Europe in 2024?
- Asia: Demand surged, especially in China and India. China capitalized on lower prices, while India boosted imports due to extreme summer heat and rising electricity needs.
- Europe: LNG imports dropped by 23 million tonnes due to strong renewable energy generation and reduced industrial gas consumption.
5. What steps is the LNG industry taking to reduce methane emissions?
The LNG sector is actively working to curb methane emissions:
- The Oil and Gas Climate Initiative (OGCI) has cut upstream methane intensity by over 50% since 2017.
- The industry is targeting near-zero methane emissions across the LNG supply chain by 2030.
6. What role does biomethane play in the LNG sector?
Liquefied biomethane (bio-LNG) is emerging as a key solution for decarbonization, especially in shipping. Since it can be transported using existing LNG infrastructure, it provides a viable pathway for reducing greenhouse gas (GHG) emissions.
7. How is LNG infrastructure supporting future energy transitions?
LNG infrastructure is already capable of handling liquefied synthetic gas (LSG) without additional investment. LSG, produced using renewable energy and captured CO₂, can be transported and utilized like conventional LNG, accelerating the transition to net-zero emissions.
8. What is the United States’ role in the global LNG market, and what risks exist?
The U.S. is cementing its position as the world’s largest LNG exporter, with its share potentially exceeding one-third of global LNG supply by 2035. However, this leadership comes with risks, including:
- High emissions intensity of U.S. LNG production
- Potential construction cost overruns
- Regulatory uncertainties
- Energy security concerns
About Shell
Shell is a global energy leader, driving innovation and sustainability in the oil, gas, and renewable energy sectors. With a strong presence in LNG production, trading, and bunkering, Shell is committed to advancing cleaner energy solutions, supporting the transition to a low-carbon future. The company invests in cutting-edge technologies, including bio-LNG and liquefied synthetic gas, to help decarbonize industries and transport. Operating in over 70 countries, Shell continues to shape the future of energy with a focus on efficiency, sustainability, and meeting the world’s evolving energy needs.
Source Shell