Over the projection period (2017-2040), it is expected that demand will grow to 1,161 bcm in 2040. An increasing population and strong economic development are key drivers for this growth. However, the growth rate will slacken during the outlook period, from 2.8% to 1.1%.
It is anticipated that virtually all the GECF countries will increase their natural gas consumption through to 2040. The exceptions are Equatorial Guinea and Trinidad and Tobago, with -0.4% and -0.1% growth rates, respectively. Russia and Iran are the major contributors to gas demand, with significantly higher totals than other member countries.
In 2016, Russia consumed over 425 bcm, with an annual average growth rate of 0.7% between 2000 and 2016. The report forecasts Russian gas demand to increase only slightly over the outlook period to 456 bcm (a growth rate of 0.3%), due to population decline and increased energy efficiency, especially in the power sector. Iran, however, will see “tremendous” growth in consumption of natural gas, the GECF said. In 2016, Iran’s gas demand was 188 bcm, with an annual average growth rate of 7.2% since 2000. Milder political conditions in recent years, the lifting of sanctions and economic development, coupled with population growth, can explain such an increase in consumption.
This report also expects that, over the forecast period, Iran’s gas demand will keep rising to 308 bcm, an average growth rate of 2.1% between 2017 and 2040. A possible external perception is that Iran is wasteful in gas consumption due to low subsidised prices. According to GECF, Egypt is also a key player. “Not only will the country be increasing production and potentially restarting exports but, given the size of recent discoveries and the size of the population, the demand for natural gas could be subject to dramatic change. Over the outlook period, it is expected that natural gas demand will increase to 76 bcm, indicating a growth rate of 1.9% per annum.”
In line with global consumption trends, the power generation sector in GECF member countries consumed 304 bcm of gas in 2016, with an annual average growth rate of 3.9% since 2000. It is expected that the absolute level of gas demand will increase over the outlook period to 426 bcm, demonstrating a growth rate of 1.4% per annum between 2017 and 2040. The demand for natural gas in the domestic sectors for GECF member countries will increase to 178 bcm in 2040, up from 124 bcm in 2016, indicating a growth rate of 1.5% a year.
Sources and photo-credits: Gulf Times