Some Australian fossil fuel megaprojects are at risk from soaring global gas prices. 

The International Energy Agency (IEA) has significantly revised down its forecast for global gas demand until 2024 by almost two-thirds.

“Global gas consumption is forecast to contract slightly in 2022, with limited growth over the next three years, resulting in a total increase of about 140 bcm [billion cubic metres] between 2021 and 2025,” a new IEA report says. 

“That is less than half the 370 bcm increase seen in the previous five years and well short of the exceptional jump in demand of close to 175 bcm seen in 2021.”

The chief executive of Santos, Kevin Gallagher, recently told reporters that persistent high gas prices threatened the industry.

“I don’t like when oil prices go too high, it concerns me, because you get supply and demand destruction,” Mr Gallagher said.

“We’ve seen gas prices that have spiked at levels that are even more unprecedented than the oil prices,” Woodside CEO, Meg O’Neill, has been quoted as saying.

Tim Buckley, director of Clean Energy Finance, says conditions are ideal for the structural shift to renewables.

“In just one year, two-thirds of the growth in gas demand globally has been taken off the table by the IEA,” Mr Buckley said. 

“Hyperinflation in fossil fuels is forcing a rethink strategically. Absolutely.”

More details are accessible here.