IEA’s Birol: Power demand surge to support gas in medium term

Demand for gas will be supported in the medium term by the global growth in power consumption for existing and new uses, according to International Energy Agency (IEA) secretary general Fatih Birol.

Addressing an audience at Gastech 2025 in Milan, Italy, on Tuesday, Birol said that the ongoing increase in electricity demand will be bullish for the gas industry.

“Uncertainty has never been so high in the energy business,” Birol said, noting that this was reducing investor appetite in some sectors.

However, he pointed to “two major certainties” for the gas sector over the next five years — a surge in electricity consumption and a wave of new LNG supply.

Electricity demand is being driven by artificial intelligence, air conditioning and electric vehicles, Birol said.

“Together with renewables and nuclear, there is a role for natural gas to play [to meet growing power consumption]. The demand side is very clear,” he said.

Global electricity consumption rose by 4.3% in 2024, the IEA previously said, with 1080 terrawatt hours of additional demand — the largest annual increase outside the post-Covid rebound. Natural gas covered 28% of that growth, second only to renewables.

On the supply side, Birol said 300 billion cubic metres of new LNG capacity will be added by 2030, led by the US, Qatar and Canada. This is expected to exert downward pressure on prices.

Global gas demand rose 2.7% last year to a record high, driven by industry and power generation, particularly in Asia, according to IEA data.