“As BP along with the rest of the world navigate the energy transition, we will need timely, objective and comprehensive data on the global energy system,” CEO Bernard Looney commented,
Calling the world’s emergence from the Covid-19 pandemic “a pivotal moment” for global economies, he underlined that “for BP, the pandemic has only reinforced our commitment to our ambition to become a net zero company by 2050 or sooner.”
A week ago, BP announced to plans to cut 10,000 jobs in reaction to a global slump in oil demand. The company’s gas and LNG business unit, in contrast, benefitted from a rise in trade despite markedly slower growth in consumption.
Demand rebounds, lead by U.S. and China
“Global natural gas consumption growth averaged 2 percent in 2019, below its 10-year average and down sharply from the exceptional growth seen in 2018 (5.3 percent),” the BP Statistical Review reads. “In volume terms, demand grew by 78 billion cubic metres (Bcm), led by the United States (27 Bcm) and China (24 Bcm).”
China’s growth in gas consumption, however, has slowed down significantly compared to the previous year, as the effects of Beijing’s coal-to-gas switching are fading. Weather-related effects (less unusually hot or cold days) also led to a 10 Bcm fall in Russia’s domestic gas consumption - the largest decline of any country last year.
Supply far outweighs demand
On the supply side, gas production was up 132 Bcm or 3.4%, outpacing the growth in consumption.
Supply from the United States made up nearly two thirds of net global growth in gas supply, according to BP figures with the volumetric increase of 85 Bcm just shy of 2018’s record increment (90 Bcm).
Australia added another 23 Bcm and China some 16 Bcm to the global gas supply in 2019, the Review states. Much of the surplus supply was used for to feed a rising number of liquefaction terminals.
Global LNG export volumes grew by 54 Bcm, or 12.7 % last year, the largest annual increase ever, driven by record volumes from the United States (19 Bcm) and Russia (14 Bcm) as well as continued growth from Australia (13 Bcm), BP analysts noted. In terms of LNG imports, nearly all incremental supply was seen headed to Europe in 2019, not Asia as was the case in years before.
“European LNG imports rose by 49 Bcm, representing an unprecedented 68% increase,” BP analysts said. Growth was widespread, with 11 Bcm headed to the UK, some 10 Bcm to France and 7 Bcm to Spain.