Midstream & Transport Monitor - October 23, 2015

A reluctance to push forward with final investment decisions (FIDs) on LNG facilities during the commodity price downturn could result in a global gas shortage beginning in 2022, McKinsey Energy Insights forecasts in a new report, “Global Gas Outlook to 2030.” LNG demand growth will remain strong at 5% per year in the short term, McKinsey said, but be countered by surging supply from new liquefaction facilities coming online in Australia and the U.S. This will produce a continued loosening of the market, which could result in a pricing convergence for gas on a global scale that is a departure from the regionalized differences that developed between 2012 and 2014. That, however, could change over the long term.