BP's latest scenarios for gas demand out to 2050 see limited scope for growth in Europe.
Like last year, the 2025 edition of BP's Energy Outlook features two scenarios. But instead of including a Net Zero scenario, BP's report now has a Below 2° scenario that explores how different elements of the energy system might change in a pathway in which the world achieves much more substantial falls in emissions. It has retained its Current Trajectory scenario that places emphasis on climate and energy policies now in place, along with recent trends and shifts in those policies.
Oil and gas continue to play a major role in 2050 under both scenarios.
In the Current Trajectory scenario gas demand increases to 4.7 trillion m³ by 2035, from roughly 4 trillion m³ in 2023. BP expects China to emerge as the single-largest demand growth centre after 2035 in this scenario.
In the Below 2°scenario, gas demand peaks by the end of the current decade, at just over 4 trillion m³ in 2035 and declines steadily from that point .
The gap between scenario outcomes for gas reflects two significant opposing forces, BP said. The first driver of increasing demand is emerging economies in Asia and the Middle East, supported by demand growth from the industrial sector, particularly the chemicals sector and light industries, BP adds. But the pace of the energy transition is the most important factor.
Demand growth from emerging economies underpins growth in both scenarios, as BP expects demand from developed markets — except the US in the Current Trajectory — to remain broadly stable or decline because of growing electrification.
Asia to absorb LNG
Growing demand in Asia is posed to support global LNG demand, but under the Current Trajectory it rises until 2050 while under the Below 2°scenario it peaks by the end of the decade.
LNG demand increases by over 60pc by 2035 from 2023, and continues to rise at a slower pace until 2050 in the Current Trajectory scenario.
LNG demand grows until the end of the decade in BP's Below 2°scenario, followed by a decline until 2050. BP sees exports falling to approximately 25pc below 2023 levels in 2050.
Russian LNG exports continue to be constrained over the first part of the outlook, but expected demand growth in the Current Trajectory scenario limits the impact of sanctions, allowing Russian exports to reach 80bn m³ by 2050, up from 45bn m³ in 2023.
BP expects Asia to "account for the entire growth in global LNG demand".
LNG important for Europe in short term
As Russian gas supply to the EU continues to fall, European countries will need LNG imports to balance demand.
BP sees Russian exports to Europe falling to around 15bn m³ by 2035 from around 30bn m³ in 2024, and 140bn m³ in 2021.
The loss of Russian gas coupled with declining European production will be met by additional pipeline gas from outside Russia and higher LNG imports, BP said.
LNG imports make up 40pc of European demand in 2035, slightly above their share in 2024, but more than double pre-2022 levels, in the Current Trajectory.
In the Below 2° scenario, EU imports of LNG in 2035 are below 2024, driven by a faster decline in demand.
Energy efficiency
The pace of energy efficiency gains over the past five years has slowed to 1.5pc/yr, compared with an average gain of 1.9pc/yr during the previous 10-year period, BP said.
"The sustained weakness in efficiency gains over the past five years was one of the most important factors shaping global energy over this period," BP chief economist Spencer Dale said. "In particular, it underpinned the continued steady growth in fossil fuels despite the rapid growth in low-carbon energy and by solar and wind."
BP said the causes of sluggish efficiency gains are not well understood but noted that the IEA attributes a combination of factors. These include the increased importance of manufacturing-intensive industries in driving the post-pandemic economic recovery in some emerging economies, the increasing intensity of extreme weather events and their impact on energy use, and a more-recent slowing in investment in projects that would improve energy efficiency.
