IEA Warns Global Gas Crunch Could Last Well into 2027
The global gas market could remain tight well into next year as Europe enters the heating season with the lowest levels of gas in storage in over a decade, the International Energy Agency (IEA) said in a new report on Tuesday. Despite the strengthened interconnectivity of the various regional gas markets in recent years, thanks to expanded spot trading and a higher number of destination-flexible…
The International Energy Agency (IEA) has issued a warning that a global gas shortage could persist well into 2027. This dire prediction comes as Europe enters the heating season with the lowest gas storage levels in over a decade. While recent years have seen improved interconnectivity among regional gas markets due to expanded spot trading and more flexible LNG cargoes, the Strait of Hormuz crisis has significantly impacted gas markets in both Europe and Asia, according to the IEA's Global Gas Security Review 2026.
The ongoing crisis in the Middle East has dealt a major blow to global gas and LNG markets. LNG shipments from Qatar and the United Arab Emirates plummeted by more than 60 billion cubic meters (bcm) between March and October. Although higher LNG output from North America and Africa, as well as increased feedgas supply from legacy producers, partially offset the decline, global LNG production still fell by 6% year-on-year.
The IEA anticipates a further 3% decrease in global LNG supply in 2026, the sharpest yearly decline ever recorded. The current situation could be prolonged until the end of 2027, as Europe's low storage levels may require substantial injections to replenish inventories through summer 2027, potentially extending global market tightness well into the coming year.
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