The rapid advancement of artificial intelligence (AI) is unexpectedly revitalising the demand for natural gas, a fossil fuel previously anticipated to diminish. Major energy companies and international organisations are now predicting a significant increase in consumption for this cleaner-burning hydrocarbon. This trend is primarily driven by the substantial energy requirements of the expanding data centre infrastructure essential for AI development and deployment. This unforeseen partnership is prompting a reassessment of global energy strategies, with potential consequences for geopolitical stability and the overall speed of the energy transition.
Leading energy firm Shell is forecasting a consistent rise in natural gas usage extending into the 2040s, illustrating the fuel's renewed commercial and political importance. The underlying logic is quite simple: AI algorithms demand immense computational power, necessitating a reliable and accessible electricity supply. Natural gas power plants, capable of rapid adjustments and emitting fewer pollutants than coal, are becoming critical for satisfying this escalating demand. This is occurring even as global climate objectives, while still important, are showing a less immediate influence on current energy decisions.
This intensified focus is already leading to considerable investments and strategic collaborations in key regions. Chevron, for example, is actively increasing its natural gas production in Israel to boost its liquefied natural gas (LNG) export capabilities. Discussions are reportedly underway between Egypt and Chevron concerning the connection of the Aphrodite gas field, which could significantly enhance regional energy supplies. Egypt currently supplies natural gas to Lebanon and Syria via the Arab Gas Pipeline, with plans to double these shipments during winter to alleviate energy shortages. Furthermore, Chevron, in partnership with Qatari investors, is exploring hydrocarbon potential in Syria. They are also investigating prospects in the Black Sea alongside Turkish Petroleum Corporation (TPAO).
The global infrastructure supporting this increased natural gas trade is also experiencing substantial growth. Projections indicate a considerable expansion in LNG export capacity over the next two years, expected to increase from approximately 593 billion cubic meters (bcm) in 2025 to an estimated 707 bcm by 2027. This anticipated surge in output, potentially reaching 484 million tons in 2026, is designed to meet a growing global appetite. This appetite is fuelled by both AI's energy needs and nations' ongoing efforts to diversify their energy sources. The European Union, for instance, has significantly reduced its reliance on Russian energy, now importing a substantial amount of LNG from the United States, a strategic shift reflecting the evolving geopolitical landscape of energy provision.
However, this natural gas resurgence presents its own set of challenges. The EU's increased dependence on US energy imports, while a practical reaction to the geopolitical fallout from the conflict in Ukraine, raises concerns given the volatile international political climate. The long-term role of natural gas as a transitional fuel, particularly in Asia where strong economic growth and reduced coal usage contribute to Shell’s optimistic demand forecasts, remains a subject of ongoing debate. While AI's power requirements are undeniable, the extent to which natural gas will remain a central part of energy policy, rather than a temporary bridge to entirely renewable solutions, will be crucial. The complex interplay between technological progress, energy security, and environmental responsibility will undoubtedly shape the future of this vital fuel.