BAKU, Azerbaijan, July 22. The gas demand for OECD Europe in 2023 is projected to decrease by 7 percent compared to the previous year, Trend reports.
According to the International Energy Agency (IEA), this decline is mainly due to a 15-percent reduction in gas consumption in the power sector due to the rapid growth of renewable energy sources and reduced electricity consumption.
On the other hand, gas usage in the industry sector is anticipated to remain relatively stable, as lower gas prices are expected to facilitate demand recovery in the second half of the year, counterbalancing the losses in the first half. Considering the cumulative declines in the year so far, the residential and commercial sector's gas demand is expected to decrease by 4 percent in 2023.
Meanwhile, during the first half of 2023, natural gas consumption in OECD Europe experienced a significant decline of over 10 percent, equivalent to more than 30 bcm, compared to the previous year.
The rate of demand reduction moderated from a 13-percent drop (22 bcm) in the first quarter to a 10-percent decline (9 bcm) year-on-year during the second quarter. The primary reason for this reduction in gas demand in Q2 was the lower gas burn in the power sector, accounting for 70 percent of the overall decrease, due to decreased electricity demand and increased output from renewable energy sources.
Looking ahead, the gas demand for OECD Europe in 2024 is projected to experience a modest increase of 1.5 percent, the IEA said.
Despite this, the expected decline in gas consumption for power generation is not fully compensated by higher gas usage in other sectors. If there is a return to average temperature conditions, there could be an increase in residential and commercial demand for gas. Additionally, gas usage in the industry sector is expected to continue its gradual recovery, although it will still remain below the levels observed before the crisis, the agency concluded.