Market Segmentation
According to the United Nations, in 2020 the global population is 7.8 billion, of which approximately 1 billion people are deprived of electricity. The world population is projected to reach 8.6 billion by 2030, further driving the energy requirement. Power industry has shifted its focus toward large-scale incorporation of natural gas as a fuel for electricity generation owing to increasing awareness regarding sustainable energy sources. The global electricity demand is anticipated to increase nearly two-thirds of the current demand over the forecast period. Growing focus on distributed power & utility projects is anticipated to bolster the market growth over the next eight years. The projected growth in natural gas in power generation business will also likely create more demand for LNG across various countries. Coal is the major source for generating electricity worldwide; however, considering the degradation of coal reserves and its adverse environmental impact, there has been a rise in the use of natural gas and other renewable energy sources for electricity production. The availability of natural gas in large quantities and its relatively lower prices, especially in regions such as North America, China, and Thailand, has led to increased power generation using natural gas. Increasing focus on generating electricity through cleaner sources and the degradation of coal reserves are factors anticipated to increase the share of natural gas in the global energy mix, thereby providing a positive environment for the growth of the LNG market.
Increase in gas supply and oil prices have resulted in reduced cost of gas. As per a report by the European Commission, wholesale gas prices rose between 2009 and 2012. However, the wholesale prices witnessed a steep decline from 2013 to 2016 resulting in gas to become one of the cheaper and cleaner alternatives for power generation. According to EIA, the U.S. Energy Information Administration (EIA) forecasts, the average Henry Hub natural gas spot prices for June, July, and August averaged USD 2.37 per million British thermal units (MMBtu). EIA predicts, since 1998 this price would be the lowest summer average of Henry Hub natural gas price. EIA estimates Henry Hub natural gas prices will be 55 cents per million British thermal units, about 19%, lower than years average. According to short-term energy outlook of EIA for 2019 Henry Hub natural gas prices were down from the June short-term energy outlook following three consecutive months of price declines. Prices in June averaged USD 2.40/MMBtu and have declined by 19% since March. In the coming years, owing to the declining price of natural gas end-use applications such as power generation and industrial users are likely to generate much demand for natural gas. The advantage of using natural gas fueled generator is that it is cleaner and greener than other fuels. When used, natural gas does not produce a pungent odor and does not emit greenhouse gases, which is common while generating through other renewable sources such as coal.
Even though the demand for natural gas as a fuel for new capacity additions is rapidly rising, its limited availability is expected to pose a major challenge for the LNG industry. As per British Petroleum, countries such as Iran, regions in former Soviet Union, and Qatar, account for over 60% of the world’s natural gas reserves. The recent shale gas boom in North America is also expected to provide leverage to natural gas production in this region. Although natural gas-powered power generation are expected to gain popularity, due to environmental regulations aimed at restraining coal-based power generation in the North American and European markets, fast-growing economies in emerging regions are expected to depend on coal owing to its lower costs. Geopolitical issues are another major factor likely to affect the natural gas supply. 2014 witnessed a clash between Russia and the West in context of the Ukraine crisis. Europe largely depends on Russia for its gas supplies, which are supplied through Ukraine. To expand energy resources and reduce the dependence on gas supplies from Russia, European countries such as Germany are planning to reduce their dependence on gas for power generation. Rising focus of the EU on reducing dependence on a single source of power generation is projected to enable the development of alternative power generation methods, which, in turn, is likely to negatively impact the LNG market in the coming years.
This section will provide insights into the contents included in this liquefied natural gas market report and help gain clarity on the structure of the report to assist readers in navigating smoothly.
Industry overview
Industry trends
Market drivers and restraints
Market size
Growth prospects
Porter’s analysis
PESTEL analysis
Key market opportunities prioritized
Competitive landscape
Company overview
Financial performance
Product benchmarking
Latest strategic developments
Market size, estimates, and forecast from 2019 to 2030
Market estimates and forecast for product segments up to 2030
Regional market size and forecast for product segments up to 2030
Market estimates and forecast for application segments up to 2030
Regional market size and forecast for application segments up to 2030
Company financial performance