IEEFA Data Dive Uncovers Key Drivers, Barriers, and Costs Shaping Asia’s Gas and LNG Future

Himasha Dissanayake, JadeTimes Staff

H. Dissanayake is a Jadetimes news reporter covering Asia

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Image source: IEEFA

The Institute for Energy Economics and Financial Analysis (IEEFA) has released a new Data Dive report—an interactive analytical tool offering an in-depth look at natural gas and liquefied natural gas (LNG) demand across 14 Asian economies. The tool standardizes government-reported data to help policymakers, analysts, and industry leaders understand how sectoral demand patterns and market dynamics are reshaping Asia’s energy future.

Co-author Sam Reynolds, IEEFA’s LNG/Gas Research Lead for Asia, noted that natural gas is used in numerous applications across the region, making demand patterns complex. The new tool simplifies these datasets, pinpointing exactly where gas demand has grown historically and where it is likely to expand. Christopher Doleman, LNG/Gas Specialist at IEEFA, emphasized that economic conditions are central to Asia’s energy transition, adding that clear insights into gas end-use sectors are crucial for assessing growth barriers and opportunities.

Rising Demand but Shifting Sectoral Patterns

Asia’s natural gas consumption rose 35% from 2015 to 2023, with China accounting for over 90% of that growth. However, decreasing demand in nations like Japan, Thailand, Malaysia, Vietnam, and the Philippines offset gains elsewhere.

While the region’s power sector remains the largest natural gas consumer, the industrial, chemical, and fertilizer sectors have driven the most significant growth over the past decade. Residential and commercial sector demand has risen almost exclusively in China, while India’s progress remains slow. Transportation-related gas use has declined in most major Asian economies except China and India.

Domestic Production Declines Push Asia Toward LNG Imports

Asia’s domestic gas production is declining overall, except in China and Malaysia. Reserves in Thailand, Bangladesh, and the Philippines are nearing full depletion. By contrast, China has already surpassed its 2030 production targets.

This domestic shortfall has accelerated Asia’s reliance on imported LNG. In 2023 alone, surveyed markets spent USD177.6 billion on LNG—nearly double their outlay in 2015. From 2015 to 2024, Australia remained Asia’s largest LNG supplier, followed by Qatar, Malaysia, the United States, and Russia. However, Asia’s LNG imports have fallen 5% in 2025, particularly from the US.

IEEFA’s findings show that while current LNG prices average around USD12/MMBtu, several Asian countries produce natural gas below USD5/MMBtu. In markets like Pakistan, key industries still depend on prices under USD2/MMBtu, making LNG integration economically challenging.

Barriers and Risks to Future Gas Demand

The report highlights multiple risks to sustained gas and LNG demand growth across power, industry, chemicals, fertilizers, buildings, and transport. While a future oversupply could lower LNG prices and boost short-term consumption, IEEFA warns that LNG will still remain more expensive than legacy domestic production in many markets.

Reynolds emphasized that relying on LNG as a substitute for domestic gas introduces new vulnerabilities—from higher fuel costs to commodity price volatility. Doleman added that even in low-price environments, LNG could weaken the competitiveness of industries dependent on cheaper, locally sourced gas.