Natural gas reserves in Europe have fallen to their lowest level in over a decade, and this increasing pressure on the global gas market could continue until 2027. This information was published in a new report examining developments in the global gas market.
Global Gas Market Developments
The "Global Gas Security Review 2026" report, recently released, indicates that the global gas market is undergoing significant transformations that are helping importers in some regions navigate supply shocks resulting from current crises in the Middle East. Since 2016, the global gas market has experienced substantial structural changes and is now moving towards greater flexibility and solidarity.
The increase in spot trading and the growing share of flexible destination liquefied natural gas (LNG) contracts have strengthened the solidarity of regional markets and enhanced their ability to withstand supply disruptions. However, the effective halt of LNG flows through the Strait of Hormuz has reduced loadings from Qatar and the United Arab Emirates by over 60 billion cubic meters from March to October of this year. This situation has led to price increases in Asia and Europe to their highest levels since the 2022-2023 gas supply crisis.
Market Outlook for Gas in 2026
According to the report, global LNG supply is expected to decrease by 3% or nearly 20 billion cubic meters by 2026. Global gas demand is also anticipated to decline by about 1.5% or close to 65 billion cubic meters, driven by reduced demand in the Middle East, lower industrial gas consumption in Europe, and a shift to coal use in the energy sector in many Asian countries.
In the European Union, gas storage sites are entering the 2026-27 summer season with inventories at their lowest level since 2013. This situation increases the region's reliance on global LNG supplies to meet peak seasonal needs and could expose the region to greater risk, especially if next winter is colder or if technical supply disruptions occur.
The report also notes that the low level of gas reserves in Europe, along with limited storage options in LNG-importing countries in Asia and South America, could intensify competition for a limited number of flexible LNG cargoes in the coming months and create upward pressure on spot prices, particularly during high-demand periods.
The decline in gas reserves in Europe may also significantly increase the need for injections to replenish inventories through the summer of 2027, which could continue to tighten global market conditions into next year.
These findings underscore the importance of strengthening international cooperation on gas supply security, especially as global markets move towards greater flexibility. Over the past decade, this organization has expanded its activities in this area to assist member countries in enhancing their preparedness for potential supply crises.
