Shell, the world’s leading LNG trader, forecasts a sharp rise in global demand for liquefied natural gas (LNG) through at least 2030, according to its new energy security report.
The company’s 2025 Energy Security Scenarios outline projections for LNG growth across three different scenarios. These forecasts are not part of Shell’s business strategy but reflect a range of possible outcomes based on factors like economic trends, geopolitical shifts, and energy transition developments.
In all three scenarios, Shell expects LNG demand to grow in the near term, driven by rising consumption in Europe and Asia. In Europe, the shift away from Russian pipeline gas and increased storage for winter heating seasons will play a key role. In Asia, growing demand for LNG is expected to replace some coal-fired power generation and support industrial production.
On the supply side, major expansion projects are expected to boost LNG production, especially after 2027. Key contributors will be new developments in Qatar, the world’s second-largest LNG exporter, and the U.S., the largest exporter. Shell predicts that LNG production could reach around 550 million tonnes per year (mtpa) by the end of the decade in all three scenarios.
Diverging Scenarios Beyond 2030
While LNG growth is anticipated through 2030, Shell’s scenarios diverge significantly after that. The company explains that differences in project timelines are the main cause of variation in the short term, but by the late 2030s, different global drivers will shape the market.
Shell’s modeling takes into account the rise of artificial intelligence (AI) and its potential economic impact. The three scenarios—Surge, Archipelagos, and Horizon—reflect various assumptions about the future of energy, politics, and the global economy.
In the Surge scenario, AI leads to stronger economic growth, driving a surge in energy demand worldwide. This results in LNG supply growing to 700 mtpa, with North America contributing significantly through new production and LNG facilities. Under this scenario, LNG’s share of global gas demand could reach 25% by 2050, up from 14% in 2024.
The Archipelagos scenario focuses on energy security, where national self-interest becomes dominant globally. Shell expects a stable and balanced LNG market, plateauing at around 600 mtpa in the 2030s.
In the Horizon scenario, the world moves toward net-zero CO2 emissions by 2050. LNG demand is expected to peak in the early 2030s before beginning a decline, as the world shifts away from fossil fuels. This could lead to underutilized LNG infrastructure as demand falls faster than natural depletion rates.
Oil Demand Trends
Shell’s report also addresses oil demand in the future. In all three scenarios, the electrification of road transport is seen as the primary driver for peak oil demand, expected after 2030 in the Archipelagos and Surge scenarios, and before 2030 in the Horizon scenario. However, oil will remain an important energy source, particularly for petrochemicals, even into the 22nd century.
Shell predicts global oil demand will grow by 3-5 million barrels per day (bpd) in the early 2030s before entering a slow decline. Despite this, oil will remain crucial for transport and the petrochemical industry.
The company also highlights the continued need for investment in oil and gas infrastructure. Shell estimates that $600 billion per year will be needed for upstream investment over the next few decades to offset the depletion of existing fields.
Shift in Energy Strategy
Shell, along with other European oil and gas companies like BP and Equinor, has recently re-emphasized the importance of hydrocarbon production. This shift, driven by rising energy security concerns and the need to deliver strong returns to shareholders, reflects a broader pivot away from aggressive renewable energy investment in favor of fossil fuel production.
The company’s updated approach underscores the ongoing role of oil and gas in meeting global energy needs, even as the world moves toward cleaner energy solutions in the long term.
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