Yemisi Izuora
Global natural gas output is set to fall by 2.6 per cent this year because of the impact of the COVID-19 pandemic, after previously being expected to grow, consultancy Rystad Energy said on Tuesday.
Rystad Energy had expected total natural gas production to rise to 4,233 billion cubic meters (bcm) in 2020 from 4,069 bcm last year.
Now it expects production to be 3,962 bcm for this year, rising to 4,015 bcm in 2021 and to 4,094 bcm in 2022.
The most affected output in percentage terms is associated gas from oilfields – a form of natural gas found in deposits of petroleum – which was initially forecast to stay largely flat year-on-year from a 2019 level of 547 bcm.
It is now expected to fall by 5.5% to 517 bcm in 2020, before rising to 530 bcm in 2021 and 542 bcm in 2022.
Rystad Energy provides data and analysis on the global energy markets.
“Part of the recovery will be driven by optimism in future oil prices, which could gradually drive output from associated gas fields to near 600 bcm by 2025,” Rystad Energy’s Head of Gas and Power Markets Carlos Torres-Diaz said.
“But how future oil prices really evolve will actually define the total natural gas output,” he added.
Rystad Energy forecasts that Brent crude oil prices will stabilise at around $60 per barrel in 2025, compared to around $43 a barrel currently.