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 September report are as follows:
Global economy:
Global GDP growth for 2024 has been revised upward to 3.2%. In the US, the GDP growth forecast has been raised to 2.7%. Meanwhile, GDP growth projections for the Euro area and China remain unchanged at 0.8% and 4.8%, respectively. Looking ahead, global economic growth is expected to hold steady at 3.2% in 2025. Additionally, global inflation continues to decline, with average rates forecasted at 4.5% for 2024 and 3.4% for 2025. However, the global economy may face headwinds in the upcoming months despite lower inflation and interest rates, and the risks are skewed to the downside.
Gas consumption:
In August 2024, gas consumption in the EU recorded a y-o-y decrease of 4.6% to 17 bcm, which was mainly driven by higher nuclear and solar output in the power generation sector. The US gas consumption dropped by 2.3% y-o-y to 73 bcm, with the power generation sector leading the decline. In July 2024, China’s apparent gas demand rose by 7.4% y-o-y to reach 35 bcm, driven by soaring temperatures, particularly in Shenzhen, a key region for gas-fired power generation. In 7M 2024, aggregated gas consumption in key gas consuming countries, which account for 60% of global gas demand, increased by 2.2% y-o-y to reach 1,390 bcm.
Gas production:
In August 2024, US total gas production continued its downward trend to stand at 98 bcm, representing a 1% y-o-y decline, as a result of announced cuts in gas production amidst low Henry Hub gas prices. In July 2024, Europe’s gas production witnessed a decline of 0.7% y-o-y in its monthly output to stand at 15 bcm, mainly driven by the remarkable declines in the UK and the Netherlands’ output. In Asia, China maintained its sustained gas production growth, with a 9% y-o-y surge, driven by unconventional gas higher output. Moreover, in Malaysia, a GECF Member Country, Kasawari field was put on stream, with target output of 5.6 bcma. In 7M 2024, aggregated gas output in key gas producing countries, which account for 72% of global gas output, rose by 2.3% y-o-y to reach 1,815 bcm.
Gas trade:
In August 2024, global LNG imports saw a slight y-o-y decline of 0.3% (0.1 Mt), totalling 33.5 Mt. This decrease was primarily due to reduced LNG imports in Europe, which outweighed the increases in the Asia Pacific and MENA regions. Europe's drop in LNG imports was linked to lower gas consumption, high storage levels, and strong pipeline gas imports, which amounted to 13.0 bcm, just 2% lower than the previous year's figure. On the supply side, an increase in global LNG exports was driven by stronger exports from Nigeria, Qatar, Russia and the US. Global LNG imports between January and August 2024 totalled 272.5 Mt, reflecting a 0.7% y-o-y increase (1.9 Mt). The Asia-Pacific region was the largest importer with 187.5 Mt, followed by Europe (67.4 Mt), Latin America and the Caribbean (9.2 Mt), the MENA region (2.3 Mt), and North America (1.1 Mt). For the full year 2024, global LNG trade is forecasted to rise by 1-1.5% driven by stronger demand in the Asia Pacific region.
Gas storage:
In the EU, the monthly average volume of gas in storage increased to 93 bcm in August 2024, which represents an average regional capacity of 89%. In the US, the average gas storage level finally returned to the five- year range in this year, increasing to 93.5 bcm, or 70% of the country’s capacity. In Asia, the combined volume of LNG in storage in Japan and South Korea was estimated at 13.5 bcm.
Energy prices:
Gas and LNG spot prices in Europe and Asia surged, reaching their highest levels of the year. The August average TTF spot price was $12.21/MMBtu, reflecting a 19% m-o-m increase. Similarly, the average NEA spot LNG price experienced a 10% m-o-m increase to $13.20/MMBtu. Meanwhile, in the US, Henry Hub prices declined, averaging $1.99/MMBtu. Although market fundamentals appear balanced, the market remains highly sensitive to supply risks. Looking ahead, extensive maintenance at Norwegian gas facilities could sustain bullish sentiment, though price- sensitive buyers in Asia may remain cautious.