BAKU, Azerbaijan, October 19. China is poised to maintain its central role in propelling global gas demand growth over the foreseeable future, contributing to 48 percent of the increase in gas demand from 2022 to 2026, Trend reports.
According to the data provided by the International Energy Agency (IEA), after experiencing its first decline in four decades in 2022, China's natural gas demand has shown a clear path to recovery in the first eight months of 2023.
The growth in demand is projected to remain robust, averaging 8 percent annually from 2022 through 2026, the agency says, although, this is a decrease from the 11 percent growth rate seen between 2017 and 2021. Factors such as slower economic expansion, relatively high gas prices, and the accelerated adoption of renewable energy sources are expected to temper China's natural gas demand growth in the short to medium term.
As COVID-related restrictions ease and price pressures subside since late 2022, China's industrial sector's gas demand is back on track, projected to grow by 8 percent in 2023 and accounting for half of this year's demand growth, the IEA noted. The industrial sector is expected to continue its multi-year trend as the primary driver of natural gas demand growth in China, contributing to 40 percent of incremental gas demand from 2022 to 2026.
While the share of coal in domestic applications decreases and cost considerations affect targeted subsidies aimed at promoting gas usage, growth in residential and commercial gas demand is expected to slow in the short to medium term, averaging 5 percent from 2022 to 2026.
Nevertheless, as per the IEA's estimations, the sector will witness incremental demand of 18 bcm, supported by the ongoing expansion of gas transmission and distribution systems. Gas demand in the transport sector is set to grow at an average rate of 6 percent annually, bolstered by the use of gas transmission networks and road transport. Collectively, transport, residential, and commercial sectors are anticipated to contribute to 22 percent of the total Chinese gas demand growth from 2022 to 2026.