Global Gas Security Review 2023

Including the Gas Market Report, Q3-2023 INTERNATIONAL ENERGY AGENCY The IEA examines the full spectrum of energyissues including oil, gas and coal supply anddemand, renewable energy technologies,electricity markets, energy efficiency, access toenergy, demand side management and muchmore. Through its work, the IEA advocatespolicies that will enhance the reliability,affordability and sustainability of energy in its 31member countries,13association countries andbeyond. SpainSwedenSwitzerlandRepublic of TürkiyeUnited KingdomUnited States IEA member countries: AustraliaAustriaBelgiumCanadaCzech RepublicDenmarkEstoniaFinlandFranceGermanyGreeceHungaryIrelandItalyJapanKoreaLithuaniaLuxembourgMexicoNetherlandsNew ZealandNorwayPolandPortugalSlovak Republic The European Commissionalso participates in the workof the IEA This publication and any map included herein arewithout prejudice to the status of or sovereigntyover any territory, to the delimitation ofinternational frontiers and boundaries and to thename of any territory, city or area. IEA association countries: ArgentinaBrazilChinaEgyptIndiaIndonesiaKenyaMoroccoSenegalSingaporeSouth AfricaThailandUkraine Abstract Russia’s invasion of Ukraine in 2022 triggered the first truly globalgas crisis, with natural gas and LNG markets contending withsupply disruptions and unprecedented price volatility. While theimmediate effects of last year's supply shock have eased in recentmonths, the structural changes that emerged in 2022 will persist foryears – and should be taken into account both by policy makers andmarket players. TheGlobal Gas Security Reviewhas provided a thoroughassessment of the evolution of gas supply security and LNGcontracting trends each year since its first publication in 2016. Thisyear’s edition includes the latest insights of the IEA’s quarterlyGasMarket Report, as well as a special spotlight on natural gas storageand evolving regulatory frameworks, taking into account theincreased need for supply flexibility. In this context, the architecture of global gas supply security and theunderlying flexibility of the market need to be carefully reassessedthrough an ever-closer dialogue between responsible producersand consumers. Ensuring secure supplies of LNG, in particular, willrequire policy makers, in close coordination with private actors, tofacilitate the development of innovative commercial offerings, novelprocurement mechanisms and new co-operative frameworks. Beyond the growing complexity of gas supply security both in theshort and long term, the decarbonisation of gas and the broaderenergy system will require the deployment and scaling up of low-emission gases. Part of the IEA’s Low-Emission Gases WorkProgramme, this year’s Review includes a special section on thistopic, with a focus on the storage of low-emissions gases and thefuture role of liquefied low-emissions gases in the internationalmaritime sector. Since its establishment in October 2022, the International EnergyAgency’s (IEA) Task Force on Gas and Clean Fuels MarketMonitoring and Supply and Security has provided key marketupdates and a platform for the effective exchange of data andinformation among members. The Task Force has worked closelywith the government of Japan ahead of the 12thLNG Producer-Consumer Conference on 18 July 2023, co-organised by the IEAand Japan’s Ministry of Economy, Trade and Industry (METI). Table of contents European gas demand dropped by over 10% in the first half of 2023 . 27Lower gas burn in OECD Europe’s power sector was the main driverbehind reduced gas demand in Q2 2023 ............................................. 28Asian gas demand is expected to recover by 3% in 2023, supported bylower prices .......................................................................................... 29China and emerging Asia returned to demand growth in the first half of2023...................................................................................................... 31US natural gas production continues to expand in 2023, principallydriven by higher gas output from shale plays....................................... 32US natural gas production rose to above the 100 bcf/d mark in the firsthalf of 2023........................................................................................... 33A new baseload: LNG accounted for close to 40% of Europe’s gasconsumption in H1 2023....................................................................... 34LNG continued to substitute Russian piped gas in Europe’s supply mixin H1 2023 ............................................................................................ 35Global LNG trade grew by 3% in first half of 2023, primarily supportedby the United States ............................................................................. 36The United States is expected to become the world’s largest LNGsupplier in 2023 ....................................................................................