Natural Gas Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Type (Compressed Natural Gas, Piped Natural Gas, Liquified Petroleum Gas), By Application (Industrial, Electric Power, Transportation, Residential, Commercial, Others), By Region, By Competition, 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 1.33 Trillion
CAGR (2026-2031)	8.08%
Fastest Growing Segment	Residential
Largest Market	North America
Market Size (2031)	USD 2.12 Trillion

Market Overview

The Global Natural Gas Market is projected to grow from USD 1.33 Trillion in 2025 to USD 2.12 Trillion by 2031 at a 8.08% CAGR. Natural gas is a hydrocarbon energy source primarily composed of methane that serves as a critical fuel for electricity generation, heating, and industrial feedstock. The market is supported by distinct drivers such as the global energy transition where nations utilize gas as a lower emission alternative to coal and rising energy consumption in emerging economies. Furthermore, the rapid expansion of energy intensive sectors like data centers is creating new requirements for reliable baseload power. According to the International Gas Union, in 2025, global natural gas demand is projected to grow by 1.7 percent to reach approximately 4,193 billion cubic meters.

Despite these positive factors, the market faces a significant challenge regarding geopolitical instability which threatens supply security and price stability. Regional conflicts often disrupt trade flows and create volatility that complicates long term investment decisions for essential infrastructure. This uncertainty regarding reliable delivery mechanisms impedes market expansion and forces import dependent nations to reconsider their reliance on international gas markets.

Key Market Drivers

Surging electricity demand from artificial intelligence and data centers is fundamentally reshaping consumption patterns within the Global Natural Gas Market. As technology firms rapidly scale their computational infrastructure, the requirement for reliable, round-the-clock baseload power has intensified beyond what intermittent renewable sources can currently guarantee. Natural gas turbines are increasingly favored to bridge this gap due to their ability to provide immediate, dispatchable energy and stabilize grids under heavy load. This trend effectively decouples gas demand from traditional seasonal heating cycles, creating a consistent year-round consumption baseline that necessitates substantial upstream investment. According to Goldman Sachs, December 2025, in the 'Accelerating Power Demand from Data Centers' report, data centers' demand for power is expected to accelerate 175 percent by 2030 from 2023 levels, a trajectory that directly incentivizes utility providers to procure secure natural gas supplies to ensure operational continuity for critical digital infrastructure.

Concurrently, the Expansion of Global Liquefied Natural Gas (LNG) Export and Import Infrastructure is unlocking new trade routes and enhancing supply liquidity. Investment is flowing heavily into both liquefaction terminals in producing regions and regasification facilities in high-demand markets, allowing stranded gas reserves to reach energy-hungry economies in Asia and Europe. This infrastructure buildout not only supports energy security but also facilitates the transition from coal in emerging markets by making gas more accessible. According to the International Gas Union, May 2025, in the '2025 World LNG Report', global LNG liquefaction capacity grew by 6.5 million tonnes per annum (tpy) in 2024. This physical expansion is essential for satisfying future requirements, as according to Shell, February 2025, global demand for liquefied natural gas is forecast to rise by around 60 percent by 2040.

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Key Market Challenges

Geopolitical instability constitutes a formidable impediment to the growth of the Global Natural Gas Market, primarily by disrupting supply chains and eroding the confidence required for long-term capital allocation. When regional conflicts emerge, they frequently sever established trade routes and threaten the physical security of pipelines and shipping lanes. This disruption introduces severe volatility into the market, causing price spikes that force import-dependent nations to question the reliability of natural gas as a stable fuel source. Consequently, this insecurity drives potential buyers to diversify their energy mix away from international gas markets, thereby dampening overall demand growth.

Furthermore, this geopolitical uncertainty directly hampers the development of essential infrastructure. The construction of liquefaction terminals and pipeline networks requires multi-billion dollar investments and years of stability to generate returns, but erratic geopolitical landscapes make such commitments increasingly risky. This hesitation to invest has led to a tangible stagnation in infrastructure expansion. According to the International Gas Union, in 2024, only 9 billion cubic meters of new LNG liquefaction capacity came online globally, a figure that highlights the widening gap between rising consumption and the slow pace of project completion. This lack of new capacity constrains the market's ability to expand, as supply struggles to keep pace with potential demand.

Key Market Trends

The Deployment of Carbon Capture, Utilization, and Storage (CCUS) in Gas Processing is rapidly accelerating as producers seek to decarbonize operations and secure the long-term viability of natural gas in a net-zero landscape. Integrating CCUS technologies directly into upstream and midstream facilities allows companies to abate high-concentration CO2 streams significantly, thereby lowering the carbon intensity of the supplied fuel and enabling the production of low-carbon "blue" hydrogen. This trend is heavily incentivized by tightening environmental regulations and carbon pricing mechanisms which are transforming emissions management from a compliance burden into a competitive necessity. According to the Global CCS Institute, October 2025, in the 'Global Status of CCS 2025' report, the number of operating carbon capture facilities globally grew to 77, driven largely by adoption in the natural gas processing sector.

Concurrently, the Growth of Liquefied Natural Gas (LNG) Bunkering for Maritime Transport is establishing gas as the primary transition fuel for the global shipping industry. As shipowners face stringent sulfur and greenhouse gas emission limits enforced by the International Maritime Organization, the maritime sector is aggressively replacing traditional heavy fuel oil with cleaner-burning LNG. This shift is catalyzing a parallel expansion of bunkering infrastructure beyond major hubs like Rotterdam and Singapore, creating a pervasive network that supports vessel refueling across diverse trade routes. According to SEA-LNG, January 2025, in the 'View from the Bridge' report, the global fleet of LNG-fuelled vessels in operation surged by 33 percent to reach 638 ships, reflecting the maritime industry's decisive pivot toward natural gas propulsion.

Segmental Insights

The residential sector is positioned as the fastest-growing segment in the global natural gas market, driven primarily by rapid urbanization and the expansion of distribution infrastructure in emerging economies. Governments are actively promoting natural gas as a cleaner alternative to biomass and coal for household cooking and space heating to mitigate environmental concerns. According to the International Energy Agency, these policy-driven initiatives to improve air quality and energy access are steadily increasing the number of residential connections, thereby sustaining strong demand momentum across the market.

Regional Insights

North America maintains a dominant position in the global natural gas market, driven primarily by extensive shale gas extraction and a robust distribution network. The United States leads this expansion through established drilling activities that increase domestic production for both local consumption and export. According to the U.S. Energy Information Administration, the region continues to prioritize natural gas for electrical power generation and industrial applications to support energy security. This strong alignment between abundant supply, highly developed infrastructure, and sustained industrial demand solidifies North America’s role as the central market leader.

Recent Developments

• In June 2025, the LNG Canada joint venture, led by Shell and its partners, achieved a historic milestone by commencing commercial production at its export facility in Kitimat, British Columbia. This project marked the first major liquefied natural gas export terminal to begin operations on Canada's Pacific coast, providing a direct supply route to key Asian markets. The facility, which possesses a production capacity of 14 million tonnes per annum, represents one of the largest private investments in Canadian history. The start-up of this terminal introduced a significant new source of supply to the global natural gas market, diversifying energy trade flows.
• In April 2025, Shell successfully completed the acquisition of Pavilion Energy from Temasek, a move that substantially bolstered its integrated gas business and trading capabilities. This strategic transaction included a portfolio of long-term liquefied natural gas supply and offtake contracts totaling approximately 6.5 million tonnes per annum, along with regasification access in Singapore and the United Kingdom. By integrating these assets, the company aimed to expand its market reach across Asia and Europe, solidifying its leadership in the global LNG sector. The acquisition also encompassed LNG bunkering operations, which further supported the company's efforts to provide cleaner marine fuel solutions.
• In September 2024, TotalEnergies strengthened its collaboration with China National Offshore Oil Corporation (CNOOC) by signing a five-year extension to an existing sales and purchase agreement. Under the renewed contract, the French energy major committed to supplying 1.25 million tons of liquefied natural gas annually to China until 2034. This agreement highlights the strategic importance of the Chinese market, which continues to drive global demand for natural gas as a transition fuel in power generation. The partnership allows the company to secure long-term sales in Asia while reducing exposure to spot market volatility, thereby enhancing its integrated gas portfolio.
• In February 2024, QatarEnergy announced the launch of the North Field West expansion project, a strategic initiative designed to significantly increase the nation's liquefied natural gas production capacity. This development aims to raise Qatar's aggregate production capability from 77 million tons per annum to 142 million tons per annum by the end of the decade, representing an increase of nearly 85 percent. The decision followed extensive appraisal drilling and testing which confirmed the presence of vast additional gas reserves in the western sector of the field. This major expansion reinforces the company's position as a dominant leader in the global energy market.

Key Market Players

• Exxon Mobil Corporation
• Royal Dutch Shell plc
• Chevron Corporation
• BP p.l.c.
• TotalEnergies SE
• Gazprom PJSC
• ConocoPhillips
• Eni S.p.A.

By Type	By Application	By Region
Compressed Natural Gas Piped Natural Gas Liquified Petroleum Gas	Industrial Electric Power Transportation Residential Commercial Others	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Natural Gas Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Natural Gas Market, By Type:

• Compressed Natural Gas
• Piped Natural Gas
• Liquified Petroleum Gas

• Natural Gas Market, By Application:

• Industrial
• Electric Power
• Transportation
• Residential
• Commercial
• Others

• Natural Gas Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE