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The liquefied natural gas (LNG) market is estimated to grow by USD 15.81 billion at a CAGR of 5.35% between 2022 and 2027. The growth of the market depends on several factors, including the increase in production, growth in its liquefaction capacity, and rising demand for cleaner fuels.
The report includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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The increase in LNG production is notably driving the market growth, although factors such as the rising adoption of renewable energy sources may impede the market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The increase in LNG production is notably driving market growth. Natural gas is one of the fastest-growing fossil fuels due to the development of worldwide supplies of coalbed methane, shale gas, and tight gas. As a result, the amount of unconventional resources will significantly expand for the global oil and gas business.
The US has been successfully extracting shale oil and gas since 2008, which has increased its availability worldwide. The Permian Basin has dominated shale gas production in the US; by 2025, output there is predicted to double. Additionally, it is anticipated that over half of the additional natural gas generated in the US will be transformed into LNG for export to nations whose domestic natural gas production is nonexistent or insufficient to meet demand. Hence, the increase in production has led to a rise in production, which is likely to boost the growth of the market during the forecast period.
Commoditization of LNG is the key trend in the market. As the variety of producers and consumers grows, so does the number of floating liquefaction and regasification plants and the liquidity of tradeable LNG, which results in the commoditization of LNG. As a result, the market will eventually evolve into one that is more open, effective, and liquid. Such programs encourage digitalization and boost openness in the oil and gas sector.
LNG has become a commodity on a global scale, opening up new opportunities for stakeholders. Reduced LNG costs have encouraged its use, accelerating the ongoing switch from coal to natural gas. The commoditization of LNG has increased LNG trading activities and benefitted vendors. Therefore, the enhanced interconnectivity and flexibility of trading and the emergence of a more transparent and competitive marketplace are expected to have a positive impact on the global market during the forecast period.
The rising adoption of renewable energy sources is the major challenge impeding market growth. Geothermal, wind, solar, biomass, and landfill trash are all examples of renewable energy sources. Due to changes in policy, there is now much more demand for capturing renewable energy sources like solar, wind, and hydropower. For example, the EU has set a goal to generate 35% of its electricity from renewable sources by 2030. In the EU, 80% of all new capacity is anticipated to come from renewable sources between 2020 and 2030.
In addition, wind energy is anticipated to surpass all other sources of electricity around 2030, largely due to the EU countries' rapid expansion of onshore and offshore wind farms. This, therefore, shows that the emphasis in energy generation has shifted to renewable energy sources. Hence, the increased adoption of renewable sources of energy is expected to lead to a decline in the use of fossil fuels.
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and forecasting strategies.
Global Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Bechtel Corp. - The company offers liquefied natural gas solutions such as integrated EPC, and hydrocarbon technology liquefaction as its key offerings. Additionally, through the nuclear, security, and environment segment, the company includes chemical weapons demilitarization projects, missile defense infrastructure, design commissioning for NASA, scientific and national security facility operations, and commercial and US operations.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market players, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth of the power segment will be significant during the forecast period. Many coal-dependent nations, including China, are switching to natural gas for electricity generation as the focus on improving air quality intensifies. Additionally, the heavy reliance on coal during times of peak electricity demand causes the plant to age and shortens its overall lifespan. This, on the other hand, is not affected by this issue.
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The power segment was valued at USD 16.60 billion in 2017 and continued to grow until 2021. The current industrial shift from conventional to unconventional resources has increased the demand in the power sector due to the abundant supply of these resources. As a result, several new power plants that run on natural gas, including LNG, are being set up. This will facilitate segment growth during the forecast period.
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Europe is estimated to contribute 29% to the growth of the global market during the forecast period. Another region offering significant growth opportunities to vendors is North America. Technavio’s analysts have elaborately explained the regional market trends and drivers that shape the market during the forecast period.
The US, Canada, and Mexico are among the nations in North America that use LNG. The main cause of the growing demand for natural gas in the US has been the switch from coal to gas in the power generation industry. The competitive pricing for industrial uses has also increased demand for it. Since it makes up a significant portion of the primary energy usage in these nations, Mexico is incredibly dependent on it.
Additionally, according to the IEA, despite the increased domestic demand, more than half of the increased production is likely to be exported in the form of LNG. To achieve this, the US is installing several new liquefaction facilities and is likely to emerge as one of the largest LNG producers globally by the end of the forecast period. Consequently, the export capacity of the US will significantly increase, which, in turn, will boost the growth of the global market in North America during the forecast period.
The market research report forecasts growth by revenue at global, regional & country levels and provides market trends and analysis and growth opportunities from 2017 to 2027.
The Market is witnessing a recovery towards pre-pandemic levels, driven by factors like gas power generation and the adoption of LNG-fueled fleets. However, challenges such as LNG oversupply and trade tensions impact the market. Despite this, there are significant LNG projects and development plans in regions like the African region, which is emerging as a key LNG market. The Liquefaction Sector plays a crucial role in this market, supported by trends like industrialization, urbanization, and efforts to reduce carbon dioxide and greenhouse gas emissions, especially in vehicles. Supportive policies, including subsidies and tax exemptions, incentivize natural gas consumption and drive growth in both importing countries and export markets.
The market measures capacity in MTPA (Million Tons Per Annum), with significant proposed liquefaction projects and final investment decisions (FID) for ventures like PFLNG Dua, Corpus Christi T3, and Yamal LNG T4. The establishment of liquefaction projects is crucial for meeting imported volumes and achieving the desired annual growth rate. Specific projects like the Jiangsu Huadian Ganyu LNG terminal contribute to the national natural gas development plan and the province's 14th Five-Year Plan. As the market grows, there's a focus on increasing LNG receiving capacity and optimizing total capacity with the support of the federal government.
Liquefied Natural Gas (LNG) Market Scope | |
Report Coverage |
Details |
Page number |
155 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 5.35% |
Market growth 2023-2027 |
USD 15.81 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
5.96 |
Regional analysis |
Europe, North America, Middle East and Africa, APAC, and South America |
Performing market contribution |
Europe at 29% |
Key countries |
US, Iran, Saudi Arabia, China, and Russia |
Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
Key companies profiled |
Bechtel Corp., Cheniere Energy Inc., China Petrochemical Corp., Eni Spa, Equinor ASA, Exxon Mobil Corp., Fluor Corp., Freeport LNG Development LP, Gasum Oy, INPEX Corp., PAO NOVATEK, PetroChina Co. Ltd., Qatargas Operating Co. Ltd., SEFE Energy Ltd., Sempra Energy, TechnipFMC plc, TotalEnergies SE, Shell plc, Chevron Corp., and BP Plc |
Market dynamics |
Parent market analysis, market growth and trends, Market forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and market growth analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by End-user
7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Vendor Landscape
11 Vendor Analysis
12 Appendix
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