IGU Says LNG Demand Will Stay Strong Until Mid-2030s as Spot Market Tells a Harder Story
The IGU's bullish demand forecast arrives as soft China spot demand and a recent 19-month price low underscore how quickly the market tilts bearish.
The International Gas Union said on Tuesday (2026-07-07) that global LNG demand will likely remain "robust" at least until the mid-2030s, with the market this year showing "flexibility and resilience" not seen in previous energy crises.7 The lobby's statement landed as JKM Asian LNG front-month traded at $16.17, a 0.68% gain on the day but still well short of the levels that characterised the supply crunch of 2022.
The IGU's confidence rests on an argument that has been building through the first half of 2026: demand growth across Asia, Europe and emerging markets has diversified the buyer base enough to absorb incoming supply waves without the price collapses that sceptics had anticipated.7 On this reading, the market's ability to juggle Middle East disruptions, European regas competition and shifting US export trajectories validates the lobby's longer-term view.
The spot data is less reassuring. Asian LNG prices dropped to their lowest point in nearly 19 months during the week of May 11 (2026-05-11), as more supply hit the market and buying interest softened.5 Total shipments into Japan, China, South Korea and Taiwan reached 15.94 million tonnes in February, down nearly 19% from the previous month, Reuters reported, citing Refinitiv Eikon shipping data.5
China, the world's second-largest LNG buyer, was the central bearish factor in that episode. Traders described spot demand from China as soft on Friday (2026-05-15), with term contract volumes covering much of the country's needs and leaving little appetite for premium spot cargoes.5
The Middle East supply picture complicates the outlook further. A Met Group executive said in May (2026-05-07) that disruptions linked to the Iran conflict were delaying a previously anticipated LNG oversupply, but that supply could still outstrip demand over the coming years.6 A Wood Mackenzie report warned separately that an extended conflict could have severe impacts on the global LNG market.4
On the supply side, Russia's output decline has become part of the calculus. Russian natural gas production fell 3.2% in the first half of the year compared with the same period a year earlier, reaching approximately 334.8 billion cubic metres by June, according to federal statistics data.3 Russian LNG output also slipped, declining 5.1% to around 16.5 million tonnes over the same period.3 Exports via the Power of Siberia pipeline are projected to rise by more than 20% this year toward the line's maximum capacity of 38 billion cubic metres annually, but that is piped gas to China rather than seaborne LNG, and does little to ease the global cargo balance.3
For European term buyers, the IGU's mid-2030s demand horizon carries practical weight. ICE Endex TTF front-month traded at €47.10 on Tuesday (2026-07-07), well below the crisis premiums of 2022-23. At those levels, new long-term LNG offtake agreements tied to US export projects require buyers to accept term pricing that looks expensive against current spot. The IGU's forecast provides intellectual backing for that decision; the spot market currently does not.
An American energy infrastructure investor and former gas midstream chief told Montel in May (2026-05-21) that rapid data centre growth in the US was unlikely to jeopardise LNG export volumes, given the breadth of domestic gas supply.2 That reading aligns with the IGU's position that structural demand growth — from emerging market electrification, industrial switching and European regas buildout — will keep the market sufficiently tight through the next decade even as new supply arrives.
Latin America adds a layer without changing the core dynamic. Experts told Montel in May (2026-05-21) that gas and LNG demand across Central and South America would rise over the coming years but that reliance on long-term contracts and growing regional trade made it unlikely the region would compete directly with Europe for spot cargoes.1
The next test for the IGU's thesis is China's summer buying. If spot demand there remains soft through July and August, the gap between lobby optimism and market pricing will widen — and the timeline to the next supply overhang will shorten.