IEA: Natural Gas Glut Likely on Record LNG Capacity Growth

SECAUCUS, NJ (DTN) – Global natural gas markets are poised for a supply glut driven by an unprecedented wave of LNG capacity coming online by the end of the decade, the International Energy Agency said in its World Energy Outlook 2025 published Wednesday (11/12).

The IEA projects that around 300 billion cubic meters per year of new LNG export capacity will enter operation by 2030.

Representing a 50% increase in global LNG availability, it will be the largest wave of capacity additions in history and is expected to profoundly shift market dynamics.

Much of the additional supply will be in the U.S. and Qatar, which together account for 70% of new liquefaction capacity.

The U.S. alone could account for one-third of global LNG supply by 2030, up from 20% in 2024, cementing its role as the largest exporter of the commodity, with a record amount of liquefaction capacity reaching Final Investment Decisions (FIDs) in 2025.

Global demand growth for gas may not be sufficient to absorb the supply coming on board, says the IEA, which expects a 65-billion cubic meters surplus over the 2024-2030 period.  

While the supply influx will significantly enhance global energy security, it will also place downward pressure on gas prices.

New demand for natural gas – which saw the strongest growth among fossil fuels in 2024 – will be centered in Asia. Emerging and developing Asian economies led by India and China drove nearly 40% of additional gas consumption last year, primarily due to rising industrial activity and increased electricity generation to meet growing cooling demand.

Under the IEA’s Stated Policies Scenario (STEPS), global gas demand continues to climb through 2035 before plateauing. However, in the less stringent Current Policies Scenario (CPS), consumption continues its ascent to 5,600 billion cubic meters by 2050, underscoring the fuel’s vital, but controversial, role as a transition bridge for developing economies.