LNG trade hits record level in 2020 despite COVID-19: IGU
LNG was one of the few commodities to see an increase in trade in 2020, with supply volumes reaching a record 356.1mn metric tons during the year, up 0.4% from the level in 2019, according to a report published on June 3 by the International Gas Union (IGU).
The growth mainly came on the back of increased exports from the US and Australia, the IGU said in its World LNG Report 2021. It was far more modest than the 11.5% rise in LNG trade registered in 2019, but against the backdrop of the COVID-19 pandemic, most commodities saw a drop in supplies last year.
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"LNG trade in 2020 was heavily impacted by COVID-19, as markets, cities and producers across the globe wrestled with lockdowns and a multitude of other disruptions," the IGU said.
Australia took Qatar's place as the world's biggest LNG producer in 2020, while US ramped up supply by a third to 11mn mt. But these increases were partly offset by declines in Trinidad and Tobago, Malaysia, Egypt, Algeria and Norway. Asia accounted for 70% of overall trade, with growth supported by increased purchases by China, India, Taiwan and South Korea.
"While COVID-19 meant significant restrictions for some of these markets, they likely also benefited from the lower price period in 2020 and purchased additional short-term volumes, and expansion of regasification capacity in some cases," the IGU said.
The gas industry "has held its own," IGU president Joe Kang commented. "Despite having to overcome many challenges in supply chain management, maintenance and commercial matters, secure and reliable supply of gas continued uninterrupted. This demonstrates the incredible resilience, flexibility and reliability of the gas sector in bringing secure, clean and modern energy whenever and wherever it is needed, even with significant parts of the world affected by lockdowns or restrictions."
The IGU hit back against recent claims that natural gas consumption should be curtailed in order for the global economy to reduce its emissions to net zero by 2050. The International Energy Agency said in a recent report that investment in new oil and gas supply should end if the world is to reach its ambitious climate objectives.
"As world leaders plan for recovery from the health and economic crisis and seek a path to meet the Paris Agreement and Sustainable Development Goals, this path is simply not achievable without gas," Kang said. "An achievable transition must be based on energy that is available for all global society, it must be clean, the supply must be secure and it must be affordable. A just transition can only be achieved with gas as a major component of the global energy mix."
The IGU's World LNG Report 2021 can be downloaded here.