Natural gas could replace coal as the second-largest energy source in the world by 2030, driven by the growing usage of liquefied natural gas (LNG) globally in order to curb air pollution, International Energy Agency (IEA) said earlier this week.
The IEA’s World Energy Outlook 2018 report states energy demand is estimated to grow more than 25% by 2040, which will require more than $2 trillion annual investments in new energy supplies.
The major reason behind growing energy demand could be geopolitical and economic issues, which are exerting complex influences on the energy markets. The ongoing trade war between the United States and China, Brexit, U.S. sanctions on Iranian oil triggering conflicts in the Middle-East are some of the factors driving the energy markets at present.
China’s emergence as the largest consumer of natural gas could reach the European Union’s level by 2040, making the Asian nation the largest importer of oil, coal, and gas. China is preceded by the United States and Russia as the largest importers of natural gas at present but the scenario is likely to change in the next two decades.
The course of future energy systems will be mainly decided by government policies, thus the need for right policies will become imperative to secure energy supplies, reduce carbon emissions and improve air quality in urban centers, the IEA’s energy outlook stated.
“Our analysis shows that over 70% of global energy investments will be government-driven and as such the message is clear – the world’s energy destiny lies with government decisions,” IEA’s Executive Director, Dr. Fatih Birol, said.
The need to curb air pollution will take center stage, thus pushing the demand for sustainable natural gas. Renewable fuel sources will constitute two-thirds of global capacity additions by 2040, backed by helpful government policies and lower costs.
The present scenario, therefore, is favorable for investing in LNG companies.
