A new report by Cedigaz’s First Estimates highlights that 2022 marked the worst natural gas and energy crisis in history due to the Russian invasion of Ukraine.

Russian pipeline gas exports to Europe slumped to the lowest level observed since the mid-1980s, resulting in a loss of 77 bcm, equivalent to 20 per cent of EU gas consumption in 2021, which had to be replaced.  The global gas market was already tight in 2021 and the Russian gas supply crisis further exacerbated the tightening and the volatility of gas markets.

Prices of all commodities and energies spiked and the European gas prices in particular showed an exceptional volatility. Countries responded to energy security issues and high gas prices with gas-to-coal switching (Germany, Asia), energy savings and an acceleration of the development of clean energy technologies. Furthermore, the slower economic growth and the explosion in gas prices led to a destruction of industrial gas demand.

Global gas consumption fell 1.6%, with Europe recording the largest drop in history

Global natural gas demand fell by an estimated 1.6 per cent to 4000 bcm in 2022, according to the first estimates of Cedigaz. At the regional level, the largest declines in gas consumption were posted in the EU & UK (- 13%; – 60 bcm), the CIS & Ukraine (- 4.6%; – 30 bcm), and  Asia-Oceania (- 1.6%; – 14 bcm), contrasting with regional growths in North America and the Middle East.

Exceptionally mild weather conditions reduced gas demand for the residential-commercial sector in many countries of the Northern Hemisphere. Furthermore, the slower economic growth (China) and the explosion in gas prices led to a destruction of industrial gas demand, energy savings, an accelerated development of renewable energies and a strong switching from natural gas to other fuels, especially coal for electricity in most Asian countries and Europe (Germany).

The year 2022 witnessed in particular the largest decline in EU gas consumption in history, down 13% to 353 bcm, under the impact of extremely wild weather conditions, energy savings, industrial demand destruction and fuel switching. The year 2022 also saw a historic decline in natural gas consumption in China (- 1.3%).

For the full report click here.