BAKU, Azerbaijan, October 24. Natural gas prices around the world are expected to remain somewhat elevated compared to pre-crisis levels, as indicated in the Stated Policies Scenario (STEPS), Trend reports.
The International Energy Agency (IEA) expects, referring to the STEPS scenario, gas prices are projected to remain high until the middle of the decade due to ongoing adjustments in global gas markets following the permanent loss of Russian pipeline gas supply to Europe. However, the situation improves with the introduction of new LNG export capacity from 2025, rebalancing the gas market, and making Asian markets the premium market for LNG once again.
Thus, after 2030, natural gas demand plateaus and decreases, with import prices stabilizing at around $8/MBtu. In the US, domestic gas production keeps prices at an average of $4/MBtu.
Meanwhile, in the Announced Pledges Scenario (APS), a more significant reduction in European natural gas demand leads to further softening of prices. Lower gas demand growth in emerging markets and intense competition among LNG suppliers drive natural gas import prices towards a range between $6.5/MBtu and $8/MBtu by 2030.
Furthermore, in the Net Zero Emissions by 2050 Scenario (NZE), a surplus of gas supply emerges in the mid-2020s as demand rapidly declines in key markets, causing prices in China, Japan, and the EU to drop to levels last seen during the height of the COVID-19 pandemic in 2020. This exerts pressure on export projects, particularly for the 40 percent of projects that haven't yet recovered their invested capital.