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Europe Could See Excess LNG Capacity Amid Declining Demand

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Europe may see an excess of LNG capacity following an increase in import terminals and projects to cover for missing Russian supplies and amid declining demand according to Montel.

  • Europe has added 30bcm/year of regasification capacity since the beginning of the war in Ukraine according to the latest IEA quarterly gas market report. European LNG terminal utilisation rates have fallen this year, to 64% in January-September compared with 75% in the same period last year, said the IEA.
  • European gas demand could decline by 8% at more than 35bcm between 2022-2026 with lower gas-fired power output and expanding renewables capacity said IEA.
  • Overall gas demand is forecast to fall by around 10% to 390bcm by 2030 while LNG imports could see a small increase up to 150-160bcm from 140bcm in 2023 according to Aurora Energy Research. The addition of three more floating terminals in Germany as planned could result in a reduction in LNG arrivals into terminals in France, Belgium and the Netherlands, said Jacob Mandel.
  • LNG terminals offered value to respond to events despite not operating at maximum levels throughout the year said Jayson Kelly at Baringa. “The current focus in Europe is on making sure there’s enough infrastructure to land LNG to maintain energy security and avoid price spikes seen in summer 2022,” he said.
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Europe may see an excess of LNG capacity following an increase in import terminals and projects to cover for missing Russian supplies and amid declining demand according to Montel.

  • Europe has added 30bcm/year of regasification capacity since the beginning of the war in Ukraine according to the latest IEA quarterly gas market report. European LNG terminal utilisation rates have fallen this year, to 64% in January-September compared with 75% in the same period last year, said the IEA.
  • European gas demand could decline by 8% at more than 35bcm between 2022-2026 with lower gas-fired power output and expanding renewables capacity said IEA.
  • Overall gas demand is forecast to fall by around 10% to 390bcm by 2030 while LNG imports could see a small increase up to 150-160bcm from 140bcm in 2023 according to Aurora Energy Research. The addition of three more floating terminals in Germany as planned could result in a reduction in LNG arrivals into terminals in France, Belgium and the Netherlands, said Jacob Mandel.
  • LNG terminals offered value to respond to events despite not operating at maximum levels throughout the year said Jayson Kelly at Baringa. “The current focus in Europe is on making sure there’s enough infrastructure to land LNG to maintain energy security and avoid price spikes seen in summer 2022,” he said.