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What Are the Prospects for Natural Gas in the Transition to a Lower Carbon World?

The coronavirus pandemic has delivered an unprecedented shock to the global natural gas market.

October 21, 2020
What Are the Prospects for Natural Gas in the Transition to a Lower Carbon World?
A gas gathering plant on a hilltop at the Southern California Gas Company's Aliso Canyon storage facility near the Porter Ranch neighborhood of Los Angeles, California, Jan. 12, 2017 (AP Photo/Jae C. Hong)

This session took place as part of AGSIW’s sixth annual Petro Diplomacy conference.

The coronavirus pandemic has delivered an unprecedented shock to the global natural gas market. This has come at a time when the environmental credentials of natural gas are being questioned due to methane emissions, with the European Union leading a decarbonization drive, gradually reducing the share of gas in power generation and other sectors to attain carbon neutrality by 2050. Gulf oil producers have been investing heavily in new gas and petrochemical projects, mostly to meet demand in a region that has abundant resources but, with the exception of Qatar, suffers from a gas deficit, largely the result of the late monetization of existing reserves. The Arab Petroleum Investments Corporation sees planned investment in the gas value chain in the Middle East and North Africa approaching $28 billion from 2019-23, up by 13% over its previous 5-year forecast.

Given the most recent developments in the global gas market, is the stage set for the emergence of a demand bubble? If oil production remains subdued in the years ahead as a result of weaker demand and a faster global energy transition, will associated gas production also fall and exacerbate the existing supply-demand imbalance? Will capital expenditure cuts by the dominant Gulf producers skew supply-side fundamentals, or is there a risk of oversupply as projects already under construction come online, outpacing slower than expected demand growth?

This program was convened by invitation only and conducted under the Chatham House Rule. If you are interested in being included in AGSIW’s exclusive events, please contact Raymond Karam, chief program and development officer: [email protected].

Speakers

    Erin Blanton

    Senior Research Scholar, Center on Global Energy Policy, Columbia University

    Ben Cahill

    Non-Resident Fellow, AGSIW; Senior Fellow, Energy Security and Climate Change Program, Center for Strategic and International Studies

    Kate Dourian

    Non-Resident Fellow, AGSIW; Contributing Editor, MEES; Fellow, Energy Institute

    Rami Shabaneh

    Research Fellow, Oil and Gas Program, King Abdullah Petroleum Studies and Research Center

Moderator

The views represented herein are the author’s or speaker’s own and do not necessarily reflect the views of AGSIW, its staff, or its board of directors.

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