The Gas Exporting Countries Forum (GECF or Forum) ‘Monthly Gas Market Report (MGMR)’ is a monthly publication of the GECF focusing on short-term developments in the global gas market related to the global economy, gas consumption, gas production, gas trade (pipeline gas and LNG), gas storage and energy prices.
The highlights of April report are as follows:
Global economy: Global GDP growth for 2024 is projected to be 2.9% by Oxford Economics, based on purchasing power parity. In the US, GDP growth is expected to be 2.7%, while in the Euro area, it is projected at 0.6%. Looking forward to 2025, the global economy is expected to gain momentum, with a projected global GDP growth of 3.2%. Global inflation is anticipated to continue its downward trend in 2024, reaching an annual average of 4.5%, down from 6.1% in 2023.
Gas consumption: In March 2024, gas consumption in the EU exhibited a notable decrease of 9% y-o-y to 32 bcm, largely due to an unusually warm winter that lessened the heating demand. Europe experienced exceptionally warm days, breaking numerous records for high temperatures, and in some places, even surpassing records for May. The US witnessed a 4.5% y-o-y decrease in gas consumption to reach 80 bcm, driven also by the mild winter weather conditions. China's apparent gas demand, which encompasses domestic production, pipeline gas and LNG imports, rose by 10% y-o-y to reach 34 bcm in February 2024.
Gas production: In March 2024, the total dry gas production in the US rose by 0.3% y-o-y to reach 88.5 bcm, with some producers announcing gas production cuts amid low Henry Hub gas prices. The European gas production witnessed a 2.9% y-o-y uptick to reach 16.7 bcm in February 2024, mainly driven by a 2.5% y-o-y increase in Norway’s output. In Asia, China continued leading gas production growth, with a 5% y-o-y rise. Additionally, in March 2024, the global number of gas drilling rigs declined by 12 units m-o-m to stand at 385 rigs.
Gas trade: In March 2024, pipeline gas imports to the EU surged by 12% m-o-m to reach 14.0 bcm. In the meantime, global LNG imports increased by 2.6% y-o-y, reaching 35.3 Mt, primarily driven by the Asia Pacific region, with minor upticks from the LAC and MENA regions, collectively compensating for a notable drop in European LNG imports. The stronger LNG imports in Asia Pacific were propelled by higher gas consumption alongside competitive spot LNG prices, which stimulated spot LNG in price sensitive markets. On the supply side, global LNG exports grew by 2.3% y-o-y to 36.3 Mt. The club of LNG exporters continues to expand with the Republic of the Congo exporting its first LNG cargo in March.
Gas storage: As the northern hemisphere winter season drew to a close, gas stocks in Europe remained high. In March 2024, the average volume of gas in storage in the EU decreased to 62.5 bcm, or 60% capacity, the highest level recorded for this time of year. In the US, the average gas storage level declined to 65.7 bcm, or 49% of the country’s capacity, similarly the highest level for the month of March since 2016. In Asia, the estimated combined volume of LNG in storage in Japan and South Korea fell to 9.9 bcm.
Energy prices: Gas and LNG spot prices in Europe and Asia experienced an uptick, following a three-month period of decline. The average TTF spot price stood at $8.5/MMBtu, reflecting an increase of 5% m-o-m. In addition, the average NEA spot LNG price experienced a 2% m-o-m increase, reaching $9/MMBtu. In the meantime, in the US, Henry Hub prices continued to decline, reaching a multi-year daily low of $1.25/MMBtu during the month. Looking ahead, it is anticipated that increased demand from price-sensitive countries in South and Southeast Asia will support prices in the forthcoming months.
Full report is available at:
https://www.gecf.org/_resources/files/mstgmr/mgmr-april-2024.pdf