Global natural gas consumption is forecast to fall 0.5 per cent this year, mainly because higher prices are curbing demand from power generators and industry after the US-Iran conflict tightened supplies, the International Energy Agency (IEA) said on Tuesday.
Global gas demand is expected to fall by around 0.5 per cent, or 20 billion cubic metres, in 2026, marking the third annual decline this decade after decreases in 2020 and 2022, the IEA said in its third-quarter 2026 Gas Market Report.
Gas demand in Asia fell around one per cent year-on-year in the first half of 2026 as higher prices encouraged fuel switching, particularly to coal in the power sector.
Europe's benchmark TTF price and Asia's Platts JKM benchmark both recorded their highest average second-quarter prices since 2022. TTF rose 32 per cent year-on-year to average nearly $16 per million British thermal units, while spot LNG prices in Asia increased 45 per cent to an average of $17.5/mmBtu.
The US-Iran conflict has sharply reduced liquefied natural gas flows through the Strait of Hormuz, a shipping route that typically carries about 20 per cent of global LNG supplies.
Global LNG supply for the full year is expected to be broadly unchanged from 2025 as increased production in other regions offsets disruptions in the Persian Gulf.
However, if the strait is not fully reopened before the start of the fourth quarter, global LNG supply could record its first annual decline since 2012, the report said.
LNG supply from Qatar and the United Arab Emirates has fallen sharply, with output down almost 80 per cent in the March-June period compared with the same four months in 2025.
(Reporting by Susanna Twidale. Editing by Mark Potter)