The International Energy Agency’s latest Global Energy Review paints a bullish picture for natural gas, revealing its strongest growth in years. As Asia’s appetite surges and LNG becomes increasingly pivotal, investors are being drawn to the fuel’s resurgence and its evolving role in the global energy mix.
Natural gas emerged as one of the standout performers in the International Energy Agency’s 2024 Global Energy Review, with demand rising 2.7% to reach an all-time high of 115 billion cubic metres. After several years of subdued growth—averaging just 1% between 2019 and 2023—this rebound signals renewed strength in the sector, driven primarily by Asia’s shifting energy strategies.
China led the recovery, with demand surging over 7% in the first half of the year, buoyed by soaring summer temperatures and a move toward liquefied natural gas (LNG) trucks. The shift away from oil and coal toward cleaner-burning fuels continues to reshape energy demand in Asia’s largest markets. However, the momentum slowed toward the end of the year as higher spot LNG prices dampened Chinese imports, highlighting the region’s sensitivity to price volatility.
The key takeaway for investors is clear: Asian markets want more LNG—but only if it’s competitively priced. This price discipline presents a challenge and an opportunity for producers, who must decide whether to prioritise market share through volume growth or maintain margins through higher prices. Flexibility and cost efficiency will be critical in navigating this dynamic.
While natural gas was among the big winners in 2024, the overall global energy demand also grew faster than usual, rising by 2.2%. Electricity demand jumped by 4.3%, driven largely by emerging and developing economies, which contributed over 80% of the global growth. This expanding demand base is where natural gas finds its strategic footing—as both a bridge fuel and a partner to renewables.
China, India, and other fast-growing Asian nations are simultaneously ramping up renewable capacity and increasing natural gas utilisation to balance grid stability and emissions reduction. This dual investment underscores gas’s role not as a competitor, but as a crucial enabler of the broader energy transition.
The report did highlight renewable energy’s dominance in new capacity additions—solar and wind contributed nearly 660 TWh of the 1,200 TWh increase in global electricity generation. However, the importance of gas as a flexible, dispatchable energy source remains undiminished. As weather-dependent renewables increase their share of the energy mix, natural gas continues to offer reliability and rapid scalability during peak demand or generation shortfalls.
Even as fossil fuels face headwinds, natural gas is benefiting from structural shifts in transport, heating, and industrial use. The transition to LNG-powered vehicles and its adoption in hard-to-electrify sectors have helped natural gas stand out in a mixed fossil fuel landscape. Crude oil, by contrast, saw its demand edge up just 0.8%, with petrochemicals providing the only notable area of growth.
The IEA’s review positions natural gas as a vital, adaptable component of the evolving global energy system. Its growth is increasingly concentrated in regions with accelerating demand, expanding infrastructure, and policy support for lower-emission energy pathways. For investors, the message is straightforward—natural gas is not fading, it’s transforming, and its resurgence is being led by markets that are reshaping the global energy order.
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