Key natural gas trends 2020

Particularly, the upward trend in total OECD production of natural gas reversed for the first time since 2009, experiencing a 2.0% drop compared to 20191. Total production reached 1542 bcm, remaining above total production in 2018.

OECD Asia Oceania was the only region to experience growth in production (+0.4%), with production in Australia increasing by 0.7% in 2020. On the other hand, natural gas production suffered a drop in the OECD Americas (-1.3%), with the United States leading the trend (-1.6%). OECD Europe followed last year’s trend by reducing production by 7.7%, mainly due to the Groningen gas plant phase out in the Netherlands (-28.1%) and scheduled maintenance at some natural gas fields and processing plants in Norway (-2.4%). 

The United States, Canada, Australia and Norway represented more than 90% of natural gas production in the OECD in 2020, with year-on-year changes of -15.2 bcm (-1.6%), -5.0 bcm (-2.7%), +1.1 bcm (+0.7%) and -2.8 bcm (-2.4%), respectively. Australia was the only country in the group to increase its total production this year.

Total OECD gross deliveries of natural gas also slowed in the growth, experiencing a 2.1% decrease in 2020 compared to 2019, and reaching 1789 bcm, which was nevertheless still above 2019 levels. Declines were observed across all OECD regions.

Despite the decrease in gross deliveries, deliveries to power generation continued to grow with a moderate 0.7% increase year-on-year for total OECD. This growth was led by the OECD Americas (+2.4%) and followed by OECD Asia Oceania (+1.2%), while deliveries to power generation declined in OECD Europe (-4.3%).

The principal contributor to the decline in gross deliveries in the OECD Americas (-1.9%) was the United States (-2.0%), followed by Canada where a 4.7% decrease was observed. In the United States, despite the decrease in total deliveries of natural gas, consumption for power generation increased by 2.7% as gas prices were the lowest they have been in decades.

Declines in gross deliveries were observed across most of the countries in OECD Europe, with a total decrease of 3.0%. The United Kingdom (-7.6%), Spain (-10.3%) and Italy (-4.6%) experienced the greatest decreases in absolute terms, while Turkey (+6.7%), Poland (+3.2%) and Greece (+11.4%), experienced the highest growth.

In OECD Asia Oceania (-0.6%), decreases in deliveries were registered in both Japan (-1.8%) and Australia (-0.5%), while Korea (+2.0%) surpassed 2019 gross deliveries and also registered a substantial increase in natural gas for power generation (+5.1%).

Total OECD imports (entries)2 of natural gas decreased by 5.2% in 2020 compared to 2019. By trade flow, pipeline imports decreased by 6.4% while liquefied natural gas (LNG) imports experienced a more moderate drop (-2.0%).

The decrease was mainly driven by OECD Europe (-5.6%), where pipeline transit between European countries was the main cause of the decrease (-6.2%). The OECD Americas (-7.7%) and OECD Asia Oceania (-1.9%) also experienced an overall decrease in imports, however different flow patterns were observed in each region. The OECD Americas registered a growth of 11.9% in LNG imports while OECD Asia Oceania experienced a 2.6% decrease in LNG imports, which was slightly offset by an increase in pipeline imports to Australia. Both trends were moderate in absolute terms.

Qatar remained the main supplier of natural gas to OECD countries in 2020, despite experiencing a large drop in imports and closing the gap with Australia.

Total OECD exports (exits)2 of natural gas experienced moderate growth in 2020, exceeding 2019 values by 0.9%. The OECD Americas (+5.6%) continued leading this growth, mainly due to increased LNG exports from the United States (+31.4%). Both OECD Asia Oceania (+2.3%) and OECD Europe (+34.0%) registered increases in LNG exports, accounting for similar amounts in absolute terms. Contrarily, total exports from OECD Europe decreased by 1.7%, mainly due to reduced pipeline intra-trade among European countries.