Shell anticipates a 65% increase in global LNG demand between 2050 and 2050

Shell's annual report said that the global liquefied gas demand is expected to increase by 65% by 2050. This will be driven by Asia, as they seek "lower-emission alternative" fuels than coal, and data centres are driving up power consumption.

In its LNG Outlook 2026, the world’s largest trader in supercooled fuel predicted that global demand would reach 700 million metric tonnes per year by this date. The report said that the LNG trade was expected to grow in 2026 from 422 million tonnes in 2025. The Strait of Hormuz is currently experiencing severe disruption, which has caused around one-fifth of the global LNG supply to be cut since the Middle East conflict began.

Shell stated that the global LNG trade could return to its previous level in 2026 if shipping in the Strait returns to normal in this summer. Then, in 2027 it will'return to growth,' Shell added.

Cederic Crémers, Shell's President of Integrated Gas, stated in the report that the conflict had created a "system-wide shock" with disruptions affecting all sectors of the economy. However, the LNG industry was resilient and able?to adapt to changing market conditions.

The company stated that recent growth in LNG supplies and regasification facilities had improved market resilience, and helped to limit the impact of "the disruption of shipping through Hormuz".

The ramp-up of liquefaction plants in North America and improved performance at existing facilities, as well as slower Asian LNG imports, have helped to offset the reduced Middle East supply. The U.S. and Israeli war against Iran has disrupted global LNG outlooks, causing prices to rise, destroying Qatar's export infrastructure, and delaying new supplies, while casting doubt on the demand of price-sensitive Asian customers. Analysts predict that higher prices will curb South Asian demand. Buyers may switch to other LNG sources, or use coal and domestic gas.

According to Kpler's data, Asian LNG imports in the first half 2026 were down by nearly 4% at 127.70 millions tons when compared to the same period last year. Shell reported that although Asian LNG spot prices were above $20 per million British Thermal Units at the height of the Middle East Crisis, they are still well below the levels of 2022 after Russia invaded Ukraine. This reflects a greater resilience on the LNG market.

The Asian spot LNG price was last $15.35/mmBtu. This is a four-month low, as the market remains 'hopeful' about an end to the conflict.

NEED FOR NEW INVESTMENTS

By 2030, it is expected that 180 million tons of LNG will be available on the market. This will improve the affordability and availability of gas as well as open up new markets.

South and Southeast Asia is expected to account for 40% of the global LNG imports in 2050, as countries look to lower-emissions alternatives to coal in order to meet a rapidly increasing energy demand. The report stated that data centres in more mature Asian markets, such as Japan are emerging?as a source of new power demand.

Shell stated that LNG would continue to play an important role in ensuring the energy security of Europe and in balancing intermittent renewable energy generation, as domestic gas production declines.

In order to meet the rising demand for LNG, it will be necessary to invest in new projects in the 2030s and 2040s. Around 200 million tons of LNG per year are needed, in addition projects that are already in construction.

Cremers stated that, "While additional investment is required in both the supply and demand infrastructure, the outlook for the long term remains positive and LNG will remain a stabilising factor in the global energy systems."

(source: Reuters)