The recent news that Qatar will be leaving OPEC in the very near future has sparked conversation among energy experts about what the future of oil will look like. It is clear from the slow break down of this once almighty organisation that oil is not what it used to be. Qatar’s main reason for leaving OPEC was in order to spend more time developing its natural gas production. Whether this is the whole truth and nothing but the truth remains unclear. But, what we can be clear about is that natural gas is on the rise.
Before we start analysing who uses the most natural gas and which countries are the top producers, it is a good idea to have a basic understanding of what natural gas is and where it comes from. First of all, you should know that natural gas is a fossil fuel. This means that it is created over millions of years and, as a result, there is a finite supply.
Natural gas is formed when decomposing plant and animal matter are heated and crushed by the pressure of the Earth over the course of millions of years. The energy that the plants absorbed from the sun during their life is stored in the chemical bonds that make up the gas. The gas is then extracted through wells that are drilled in areas where there are gas deposits.
The main gas that forms natural gas is methane, which stays in the atmosphere for a lot less time than carbon dioxide. The problem with methane, however, is that it is very effective at trapping heat, meaning its potential for causing global warming is far higher than that of carbon dioxide. As a result, the use of natural gas is far from ideal for a world that is trying to bring down the global temperature. Nevertheless, scientists are looking to natural gas a bridge between traditional fossil fuels and renewable energy sources. While the methane is a problem, the energy source is still cleaner that oil or coal.
So, where does all of this natural gas come from? Well, we know that Qatar is ramping up its production of natural gas and it currently sits at number two on the list of natural gas exporters. First place goes to Russia, while Iran, Turkmenistan and the USA take third, fourth and fifth. If Qatar is looking to become the number one exporter of natural gas, it will have a mission on its hands if it wants to overtake Russia. Russia currently supplies around 40% of all of the EU’s natural gas imports, with many countries are 100% dependent on Russian gas.
Fortunately, there are plenty of other countries that import natural gas. Japan, for example, is one of the world’s top consumers of natural gas, but it produces virtually nothing itself. This is a troubling situation for any country to be in, as a lack of domestic energy can lead to energy security issues. Russia, Iran and the USA are also big consumers of natural gas, but this is less of a concern given that they are able to supply themselves with the energy source.
It is unlikely the world will ever be entirely dependent on natural gas, but the energy source plays an important role in the immediate future. Increased usage of natural gas instead of coal could reduce air pollution and provide a cleaner way of meeting peak electricity demand.
NRG Expert - Energy Market Research 