2020 is on its way to experiencing the largest recorded demand shock in the history of global natural gas markets. The Covid-19 pandemic hit an already declining gas demand, faced with historically mild temperatures over the first months of the year. Gas consumption is expected to fall by 4% in 2020, under the successive impacts of lower heating demand from the warm winter, the implementation of lockdown measures in almost all countries and territories to slow the spread of the virus, and a lower level of activity caused by the Covid-19 induced macroeconomic crisis.

Faced with this unprecedented shock, natural gas markets are going through a strong supply and trade adjustments, resulting in historically low spot prices and high volatility. Natural gas demand is expected to progressively recover in 2021, however the Covid-19 crisis will have longer-lasting impacts on natural gas markets, as the main medium-term drivers are subject to high uncertainty.

This report provides a detailed analysis of recent natural gas market developments, assesses the impact of the Covid-19 crisis on the short to medium terms and discusses the main drivers and uncertainties to future gas supply and demand to 2025.