The global demand for liquefied natural gas (LNG) is projected to rise by approximately 60% by 2040, fueled by economic expansion in Asia, the influence of artificial intelligence on energy consumption, and efforts to reduce emissions across heavy industries and transportation. This forecast was detailed in Shell’s latest annual LNG outlook report.
According to industry estimates, LNG demand is expected to reach between 630 million and 718 million metric tons annually by 2040, marking an upward revision from last year’s projections of 625 million to 685 million metric tons. This increase reflects the growing role of natural gas as a transition fuel in global energy markets.
China, the world’s largest LNG importer, and India are significantly expanding their LNG import capacity and related infrastructure to meet rising energy demands. China’s LNG imports reached 76.65 million tons in 2023, part of a total natural gas import volume of 131.69 million tons, the highest recorded since 2013. Economic stimulus policies are expected to further drive industrial gas consumption, though ongoing trade tensions with the United States may temper growth.
In India, natural gas consumption is projected to increase by 60% between 2023 and 2030, effectively doubling the country’s LNG import needs. With domestic gas production expected to lag behind demand, India will increasingly rely on global LNG markets to bridge the gap.
Despite rising demand, global LNG supply faces uncertainties. While 170 million tons of new LNG production capacity is expected to come online by 2030, project delays due to geopolitical tensions, regulatory hurdles, labor shortages, and supply chain disruptions have pushed back the availability of 30 million tons of new supply—equivalent to India’s entire LNG import volume—to at least 2028.
In 2024, the total volume of LNG traded globally reached 407 million tons, marking a marginal 2-million-ton increase—the smallest annual rise in the past decade. This shortfall highlights ongoing challenges in bringing new LNG capacity to market.
Europe is anticipated to remain a strong LNG market beyond 2025. With the increasing share of intermittent renewable energy sources, LNG will continue to play a crucial role in stabilizing power generation. Over the long term, existing natural gas infrastructure could be repurposed for bio-LNG, synthetic LNG, or even green hydrogen imports, supporting Europe’s broader clean energy transition.
The United States is on track to become the world’s leading LNG exporter, with annual output projected to reach 180 million tons by 2030, accounting for one-third of global supply. Meanwhile, Qatar’s North Field expansion project, set to go online in 2026, will further solidify its position as a major LNG supplier. By 2035, the U.S. and Qatar together are expected to contribute approximately 60% of the world’s LNG supply, significantly shaping global energy markets.
As LNG demand continues its upward trajectory, investments in infrastructure, supply chain resilience, and regulatory stability will be critical in meeting future energy needs while ensuring a smooth transition to lower-carbon energy sources.
