BMI: Malaysia's Average LPG Demand To Grow 0.8 Pct Annually Between 2025 And 2034

KUALA LUMPUR, Sept 8 (Bernama) -- Malaysia’s average liquefied petroleum gas (LPG) demand growth rate is projected to slow to 0.8 per cent annually between 2025 and 2034, said BMI, a Fitch Solutions company.

In a note today, BMI said the country’s LPG consumption faces headwinds from the growing use of natural gas in the commercial and industrial sectors.

It said residential and commercial LPG demand is increasingly competing with piped natural gas, electricity and liquefied natural gas.

“Improvements in pipeline gas networks and electrification are weighing on LPG consumption in these segments. In the commercial sector, LPG use has declined as city‐gas network expansions substitute LPG for natural gas.

“Residential demand remains relatively resilient, but growth has slowed since 2023 amid gradual policy and commercial pressure on households to switch to natural gas for cooking,” it said.

The research firm said the rapid penetration of natural gas into commercial and industrial energy use, supported by continued investment in city‐gas networks, is likely to have a more visible impact on LPG consumption in the medium to long term.

“The government’s ongoing expansion of natural gas transmission and distribution infrastructure will also exert a lasting drag on long‐term LPG use,” said BMI.

Meanwhile, BMI expects Malaysia’s LPG exports to grow marginally, in line with potential increases in non‐refinery supplies.

“Long‐term export growth prospects are supported by a structural slowdown in domestic consumption and the resulting surplus available for export.

“LPG exports from liquefied natural gas plants are therefore expected to rise marginally over the coming years, broadly in line with incremental upstream natural gas and liquefied natural gas output,” it added.

-- BERNAMA