ABUJA, Nigeria (VOICE OF NAIJA)-The World Bank has projected continued volatility in global natural gas prices, warning that geopolitical tensions, supply disruptions and shifting demand patterns will keep energy markets unstable in the near term.
The projection was contained in an analysis based on the April 2026 Commodity Markets Outlook, which examined recent developments in global liquefied natural gas markets and provided forecasts through 2027.
According to the report, global gas markets have been heavily impacted by disruptions linked to tensions in the Middle East, particularly the closure of the Strait of Hormuz, a critical transit route for LNG exports from major producers such as Qatar and the United Arab Emirates.
The World Bank noted that the disruption triggered sharp price increases in key markets, with Asia’s LNG benchmark rising by about 94 per cent in March, while Europe’s benchmark climbed by around 59 per cent over the same period due to heightened competition for limited supply.
Although prices later moderated, the institution warned that the market remains highly vulnerable to supply shocks and geopolitical developments, with volatility expected to persist in the short term.
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The report stated that the United States LNG benchmark faced comparatively less pressure, supported by strong domestic output and sufficient storage capacity, which helped cushion the impact of global disruptions.
It added that while global gas demand growth has slowed significantly rising by just 0.8 per cent in 2025 supply constraints and regional competition continue to exert upward pressure on prices.
The World Bank further projected that natural gas prices could rise again in 2026 before easing partially in 2027, depending on the recovery of Middle Eastern LNG supply and the restoration of operations in key exporting regions.
However, it cautioned that risks remain tilted to the upside, including prolonged geopolitical tensions, low storage levels in Europe, and rising electricity demand from emerging sectors such as artificial intelligence-driven data centres.
The report also noted that Europe’s gas storage levels remain below historical averages, raising concerns about the region’s ability to replenish inventories during peak demand periods.
On the downside, the World Bank said weaker-than-expected economic growth in Asia could reduce demand and ease price pressures, though it stressed that this would not eliminate underlying supply risks.
Overall, the institution said the global gas market is entering a phase of heightened uncertainty, where supply disruptions, rather than demand growth, are increasingly shaping price movements.
It added that unless geopolitical tensions ease and new supply capacity comes fully online, volatility in global gas prices is likely to remain a defining feature of the energy outlook over the medium term.