Global natural gas industry - statistics & facts

The global natural gas industry is a crucial part of the world's energy landscape, providing a significant portion of the world's energy needs. The industry has undergone a transformative period in recent years, with many companies reassessing their business models and strategies in response to the changing energy landscape. According to the International Energy Agency, the energy sector, which includes the oil and gas industry, accounted for approximately two-thirds of total global greenhouse gas emissions in 2019. In reality, the oil and gas sector is the primary driver of the global economy. For instance, in the US, the gas industry accounts for approximately 4.8 percent of the state’s GDP.

Although the recent COVID-19 contributed to a significant demand for production and demand of oil, in 2023, the oil demand increased by approximately 30,000 barrels per day to 102.19 million barrels per day. In 2024, it is estimated that the demand will increase to 102.8 million barrels per day. This has increased pressure on the industry to adopt more sustainable practices and shift towards renewable energy sources. One strategy that has gained traction in the industry is the use of natural gas as a transitional fossil fuel. Analysis of the dynamics of global energy production and consumption indicates that a paradigm shift is occurring toward more reliable and sustainable energy sources, with natural gas playing a dominant role.

What factors contribute to natural gas profits?

Natural gas has become an increasingly important energy resource in recent years, with growing demand and a shift towards cleaner energy sources. The prospects for natural gas are high, driven by factors such as the growing energy needs of the expanding global economy, environmental pressures for cleaner fossil fuels, market developments, and technological advancements in production, transportation, and storage. Here are 4 factors that contribute to natural gas profits

Regulatory and Environmental Risks

Natural gas producers must navigate a complex web of regulations and environmental standards that can significantly impact their operations and profitability. Stringent emissions controls, permitting requirements, and other regulatory burdens can increase costs and limit the ability to extract and transport natural gas. At the same time, the environmental risks associated with hydraulic fracturing, such as methane leaks and induced seismic activity, must be carefully managed through robust oversight and best practices. The enforcement of stronger regulations is necessary to minimize risks to the environment and human health, though this can increase the cost of extraction.

Refining, Distribution, and Marketing Costs

The costs of refining, distributing, and marketing natural gas can be substantial. The industry has invested heavily in liquefied natural gas (LNG) and compressed natural gas (CNG) technologies to facilitate transportation and storage, but these processes add significant expenses. Smaller producers, who make up a significant portion of the industry, often lack the scale and financial resources to optimize their operations and efficiently manage these costs.

How do Natural Gas prices affect the profits of natural gas companies?

Economic conditions

Economic conditions such as market opportunities, leverage, firm size, and energy prices have a significant influence on the profitability of firms in the natural gas sector. For instance, the recent COVID-19 pandemic impacted the financial performance of companies, as external factors like economic health and market stability can greatly affect sales and gross profits. Ideally, when states are experiencing periods of economic growth, heightened demand for goods and services from industrial and commercial sectors might increase demand and prices for natural gas.

Market Supply and Demand:

In the natural gas industry, demand and supply aspects include the primary driving forces that affect commodity prices. For instance, when the product of natural gas is higher than the current demand, the prices tend to decline. Also, when the prices of alternative fuels including coal or petroleum are high, others can replace such fuel sources with natural gas. Since, most people can easily switch between fuel sources, prices of such fuels become inversely correlated.

Gas Profit Trading Platforms

When you search online, you will come across numerous online trading applications and platforms for trading natural gas. The platforms are designed with trading bots to equip people to invest and trade in the unpredictable gas industry. The most common trading platforms include Gas Profit, Saxo Markets, and City Index. However, you should undertake comprehensive research and consider the risks of every platform before you start trading.

Gas Profit includes one of the most innovative online trading platforms designed to equip people to trade and invest in the gas sector. This platform was inspired by the consequences of cryptocurrencies on the global financial landscape and purposed to offer related chances in the gas industry. It has been equipped with a user-friendly interface and state of art trading technology, making it easily accessible to experienced and novice traders. Gas Profit uses sophisticated algorithms (trading bots) to analyze market data contemporaneously and identify profitable trading chances. Most importantly, the platform emphasizes the security and safety of the trading experience, offering a transparent trading atmosphere with privacy being prioritized.