WEO Week: Electricity sector transitions: policy and finance


Natural gas is the cleanest burning and fastest growing fossil fuel, contributing for almost one-third of total energy demand growth through the last decade, more than any other fuel.


Key findings

Natural gas demand growth by sector, 2019-2021


The gas supply system is under immense pressure

Winter 2021/22 opens with record high seasonal gas prices, as the combination of a strong recovery in demand, extreme weather events and unplanned supply outages have led to tighter markets. Such tensions are a reminder that security of supply remains a major topic for gas markets, only a year after a record drop in demand and oversupplied markets.

Read the IEA's statement on recent developments in gas and electricity markets

Natural gas demand growth by region, 2019-2021


Natural gas demand declined less than other fossil fuels in 2020

Global natural gas consumption declined by 75 bcm (or 1.9% y-o-y) in 2020. This represents the largest recorded drop in gas demand in absolute terms, but it would be on a par with 2009 in relative terms. Gas was markedly less impacted than oil or coal demand in 2020, and a progressive recovery of gas demand was observed in the third quarter as lockdown measures eased, while seasonal electricity demand and competitive prices pushed up gas consumption.

Flaring by region in the Sustainable Development Scenario, 1985-2030


Flaring emissions must drop rapidly to get on track with the IEA's Sustainable Development Scenario

Around 145 bcm of natural gas were flared in 2018, a slight increase from levels in previous years and broadly equal to gas demand across the continent of Africa. This resulted in emissions of roughly 275 MtCO2, as well as some methane emissions (from uncombusted portions of flares) and other GHGs such as black carbon and nitrogen oxide. Russia, Iraq, Iran, Algeria and the United States were responsible for more than half of global flaring. Several field trials have demonstrated viable technologies to reduce flaring, but at root the issue of flaring is also a question of business models. If there is inadequate provision for productive use of the gas at the project planning stage, including the necessary gas infrastructure, then finding a technology fix later on is much more difficult. There is an increasing number of voluntary government and industry commitments to eliminate flaring by 2030. The SDS relies on a rapid reduction in flaring, with government policies and industry commitment all but eliminating it by 2025.


Our work

Created in 2013, the GOTCP brings together representatives from governments, industry and academia in a global dialogue to explore the role of oil and gas technology in the energy transition. GOTCP aims to catalyse innovation across oil and gas technologies and to provide collaborative opportunities for enhancing national capabilities within both onshore and offshore activities.