LNG Demand to Hold Through Mid-2030s as Europe's Storage Deficit Widens
Industry forecasts of sustained LNG demand through the mid-2030s are gaining traction as European gas inventories trail year-ago levels by the widest gap since 2022.
European gas demand will plateau rather than fall through 2030, with LNG taking on a growing balancing role before demand begins a gradual decline, Shell said on Tuesday (2026-06-30). Industry lobby groups have gone further, projecting demand will remain robust through the mid-2030s, a timeline that would underpin a larger buildout of liquefaction, shipping and regasification capacity than mainstream energy transition scenarios had anticipated.5
The persistence matters because the financial case for long-term LNG supply contracts, typically running 15 to 20 years, depends heavily on demand forecasts in the 2030 to 2040 window. Shell's plateau-to-2030 view, aligned with lobby projections of sustained demand, gives infrastructure developers a firmer basis for final investment decisions than a faster-declining curve would allow. The revision also reflects a slower rollout of European heat pumps and renewable generation than policy targets had implied.5
The near-term picture reinforces that demand framing. European gas inventories entered the 2026 injection season approximately 7.2 billion cubic metres, or 17%, below last year's level, according to Timera Energy. Ongoing Middle Eastern supply disruption has pushed the ICE Endex TTF forward curve into backwardation, meaning near-term prices are elevated relative to winter delivery and the financial incentive to inject aggressively has largely disappeared.4
Storage operators are consequently underfilling relative to the rate required to meet the European Commission's 90% target by November. Timera estimates each 1 bcm shortfall at end-September adds approximately $0.40 per MMBtu to ICE Endex TTF Jan-27 delivery. With TTF front-month currently at €47.10 and NBP up 4.2% on Tuesday (2026-07-07) to €44.66, the autumn injection trajectory is the principal variable driving the winter price outlook.4
At the global level, the LNG supply picture is more balanced than European demand signals suggest. JKM Asian LNG spot prices were at $16.17 per MMBtu on Tuesday (2026-07-07), up 0.68% on the day, but supply-side signals in the complex are running bearish as new liquefaction capacity adds flexibility to the spot market. If Asian buyers remain price-sensitive through summer, competition for swing cargoes between European and Asian buyers may ease relative to last winter's levels.1
Latin America is unlikely to add to that competition, according to experts cited by Montel. Growing Central and South American gas demand is largely covered by long-term contracts and expanding intraregional trade, leaving European buyers with fewer demand-side rivals for spot LNG than supply-focused traders might expect. Regional infrastructure development there is proceeding, but the pace does not point to a structural shift in cargo allocation toward the Atlantic Basin within the current decade.1
A regulatory complication is building at the supply end. U.S. LNG exporters are pressing the European Union to delay enforcement of its methane emissions rules until at least 2028, arguing the regulations are generating costs across the supply chain that American producers did not price into long-term contract structures. For European buyers, a delay would reduce compliance overhead. For EU regulators, conceding ground on methane rules would create pressure to revisit other environmental conditions attached to LNG import agreements. The outcome remains contested.3
Russian LNG production fell approximately 5.1% to around 16.5 million tonnes in the first half of 2026, according to federal statistics data reported by Montel. The decline reduces one source of global flexibility at a moment when European buyers need alternative supply. Russian pipeline exports via the Power of Siberia to China are projected to rise more than 20% this year toward the line's 38 billion cubic metre annual capacity, redirecting supply eastward rather than adding to the cargoes available to European importers.2
European storage operators face the remainder of the injection season with little margin for error. Meeting even a revised end-October target requires steady LNG arrivals, near-normal summer temperatures across the northwest of the continent, and a seasonal shift in ICE Endex TTF forward spreads that makes injections economic again. September LNG spot availability, and whether Asian demand holds or softens, will determine whether the current storage shortfall narrows or compounds into winter.4