Gas prices are expected to rise in the coming months as demand from China’s booming population continues to rise, as well as increased demand from other developing nations.
According to a report by consultancy GasBuddy, the average price for natural gas in 2020 was $4.17 per million British thermal units, or $4 per kilogram.
That was up about 8% from the year before.
This will increase to $5.08 per million Btu in 2021, and then to $6.27 in 2022, the company said.
“This is a trend that is not only in China, but across the region,” GasBuddys founder Mark Evans told Polygon.
“In 2020, it was $3.98 a litre in China.
By 2022, it is up to $7.50.”
GasBudgets forecasts that prices will remain high until 2023, but that growth is expected to slow down as demand is reduced in developing nations and in the United States.
In 2018, gas prices averaged $4 a million BtU.
In 2019, the price fell to $3 a million.
In 2020, the rate was down to $2.60 a million, according to GasBuds forecast.
The company expects that price to rise again to $1.55 a million by 2026.
“Demand is growing as we go from the mid-2020s to the mid 2030s,” Evans said.
The global average price of natural gas dropped below $3 per million in 2020, but by 2021, the figure was up to a whopping $6 per million.
“By 2022, there is still a lot of growth in demand,” Evans added.
But that growth could be slowed down as countries like China, India, and Brazil continue to expand their population.
Evans also said that prices could increase by about 2% annually until 2026, though this is more than double the 2% average increase that has occurred over the last 15 years.
“If you look at the trends that we’ve seen over the past 15 years, prices are going up because of that,” Evans explained.
“But the demand is going up.”
GasBs data also suggests that the cost of natural gasoline could increase.
“Gas prices are set to increase by 3.5% annually from 2021 to 2023 and 3.9% annually thereafter,” Gas Buddy noted.
This is higher than the average 3.4% increase for the last 10 years.
GasBubs forecast that prices would increase by an average of 5% annually to 2027.
This was about half the average 6.3% increase over the 10-year period, according of GasBuns forecasts.
But this is also a large jump from the previous five years.
The firm expects prices to average $1 per million metric cubic feet in 2021.
That would be about $7 per million cubic feet higher than what it was in 2020.
In 2021, gas pricing averaged $2 per million, while it averaged $3 in 2022.
That year, it increased to $9 per million and $11 per million for 2021 and 2023.
Evans said that the overall increase is due to a combination of higher prices in China and other emerging economies, as they are expected by many governments to ramp up demand.
He also noted that gas is now being exported, which increases demand, but this does not necessarily mean that the price of gas will increase as countries seek to export their natural gas.
He pointed to a recent study that showed the price for North American natural gas rose to $8 per million by 2020, from $4 in 2020 due to exports to Europe.
But in 2022 and 2024, the prices were slightly lower than they were in 2020 and 2021.
Evans added that the market for natural-gas products has also grown.
“For the first time in a very long time, the volume of natural-Gas products in the market is more diversified than it has ever been,” Evans told us.
“As the demand continues to grow, the demand for natural Gas will continue to grow as well.
The price of Natural Gas is set to continue to rise for the foreseeable future.”
The increase in demand is likely due to the fact that people are buying more gas because of increased fuel efficiency.
“A lot of people are driving cars, and that’s where natural Gas is coming from,” Evans continued.
“We’ve had a lot more gas cars in the last decade.
There are now about 30 million more people on the road.
People have bought more gas-powered cars.
And the number of people driving more gas is also increasing.”
As demand continues, the market will also grow for liquefied natural gas, or LNG, as this is now a major component of the world’s liquefaction infrastructure.
Evans explained that this is an industry that is still in its early stages.
“The industry is still developing, but it’s still growing,” Evans noted. “There are