Natural Gas Extraction in France - Market Size, Industry Analysis, Trends and Forecasts (2025-2029)

Natural Gas Extraction in France industry analysis

Fossil fuels have been extracted in France since the beginning of the 20th century, helping to secure the country's energy supply. Natural gas is still used in a wide range of industries, including the energy sector, industry sector and private households. However, fluctuating international gas prices and dwindling reserves put the industry under increasing pressure. The COVID-19 pandemic and the resulting sharp drop in demand for gas products led to a decline in prices until the trend reversed in 2021. The recovery of the European economy from the effects of the pandemic and the resumption of production activities by many companies led to a rapid increase in demand for fossil fuels in 2021. The beginning of the Russia-Ukraine war in February 2022 and the embargo on gas imports from Russia and Nord Stream supply cuts fuelled supply shortages, and gas prices rose again. As a result, the sales of French gas production companies increased. However, this effect waned in 2023 as supply shortages abated; revenue fell as gas prices dropped. However, prices are set to remain higher than most pre-pandemic years, stemming from elevated production levels and continuing consumer spending levels.

Trends and Insights

• Russia’s invasion of Ukraine spurs a shift in European natural gas supplies. Europe’s efforts to cut its dependence on Russian gas supplies has spurred a surge in natural gas prices across the continent.
• Natural gas producers face a tough battle with renewables. Despite being the cleanest fossil fuel, natural gas is losing its popularity as a power source for electricity as renewables quickly gather momentum across the continent.
• Limited natural gas reserves facilitate the dominance of a small number of companies. A few large multinationals and state-owned corporations operate Europe’s major gas fields, though partnerships on oil and gas fields ensure some distribution of income.