Testing the resilience of the LNG industry through crisis

LNG is a stabilising force, offering flexible and reliable energy, especially during times of crisis. Over the last decade, it has grown from an important fuel to a cornerstone of the global energy system. If there is one lesson from the past decade, it is that the global LNG industry has repeatedly been tested and proven its value in delivering flexible and reliable energy worldwide.

Whether during the COVID-19 pandemic, Europe’s gas crisis following Russia’s invasion of Ukraine, or this year’s Middle East crisis, the LNG industry has faced immense challenges over the course of less than a decade. Yet each shock has helped to build greater industry resilience and flexibility to meet the next one.

This year marks the 10th edition of Shell’s LNG Outlook, an annual report compiled using data from third party providers. Every year it analyses where the market is heading and this anniversary gave us the opportunity to assess how far it has come.

The numbers tell their own story. Since 2016, global LNG trade has expanded by around 60%, rising from 264 million tonnes to more than 420 million tonnes in 2025. The number of importing countries has grown from 36 to 49, while LNG-fuelled vessels in operation have increased from just 77 ships to more than 900.

A global energy shock

The disruption to the Strait of Hormuz removed around one-fifth of the world’s monthly LNG supply at its peak. The global LNG market was quick to adapt. More supply from North America, stronger performance from existing facilities, rerouted cargoes, and deferred maintenance helped cushion the impact on the supply side. On the demand side, a combination of fuel switching, slowing imports, and gas storage withdrawals helped to balance the market.

While prices were higher, the market response has been significantly more measured than during previous crises, showing its ability to respond to disruptions and move energy to where it is needed most. Over the long term, the LNG Outlook forecasts that global LNG demand could grow by around 65% by 2050, nearly 700 million tonnes per year as countries continue to prioritise the energy security gas offers. 

Asia is at the heart of that growth story. As economies develop and urbanise across South and Southeast Asia, demand for power and industry will continue to rise. By 2050, these regions are expected to account for around 40% of global LNG imports as countries turn more to gas to support economic growth while reducing dependence on more emissions-intensive fuels.

The demand forecast for LNG in Asia is also supported by declining domestic gas production, creating a structural supply gap that LNG is expected to fill. By 2050, without further exploration and production, that gap could approach 300 million tonnes annually. At the same time, LNG’s role is expanding beyond its traditional markets. In the shipping industry, more than 900 LNG-fuelled vessels are now in operation, with hundreds more on order.

Significantly, demand for LNG bunkering is forecast to increase sevenfold by 2035 to around 27 million tonnes per year, which is more LNG than India imported in 2025. Around 180 million tonnes per year of new LNG supply is expected to enter the market by 2030, improving the availability and affordability of gas. 

Progressing the energy transition 

Not to be overlooked as a catalyst for continued growth is LNG’s wide-ranging role in the transition to a lower carbon energy system. Switching from coal to gas has had a notable effect on reducing CO2 emissions globally as it emits about 50% less carbon than coal when used to produce electricity. And the trend continues. In some places around the world, new gas-fired power plants are replacing coal-fired ones. Gas is an increasingly important partner to renewable energy and the rapid roll out of renewable energy projects in recent years has highlighted this trend.

When the wind doesn’t blow or the sun doesn’t shine, gas-fired power plants can ramp up quickly to play a crucial role in maintaining a reliable power supply to meet demand. While the roll out of renewable energy has been rapid in recent years, it still faces limitations, especially in meeting the needs of hard-to-abate industries. As an industry, we need to make more progress on curbing methane emissions, bringing down the carbon intensity of the natural gas and LNG value chain through innovation and incremental blending of LNG with bio-LNG, to offer a pathway to net-zero emissions.

As a trusted LNG supplier to both long-established and new customers, Shell’s core focus is on continuing to expand our global LNG portfolio and capability to deliver cargoes around the world to best support our customers. Through recent investments and acquisitions, namely Singapore-based Pavilion Energy, LNG Canada, the Ruwais LNG project in the United Arab Emirates and the Manatee gas field off the coast of Trinidad and Tobago, Shell is working to bolster LNG supply volumes in the years to come and helping to meet the energy security needs for people around the world.