Qatar's LNG exports collapse 96% as Hormuz stays blocked

Summary

• Qatari LNG exports fell 96% from the war's start through August, Reuters reported.
• Almost 20% of global LNG supply moved through the Strait of Hormuz before the war.
• Europe failed to refill gas storage this summer, pointing to higher winter utility bills.

The latest

Qatari liquefied natural gas exports dropped 96% between the start of the US-Iran war and August compared with the same period a year earlier, Reuters reported. Shipments from one of the world's largest LNG exporters have been virtually halted since Feb. 28. Middle East crude exports, by contrast, have nearly recovered to prewar levels.

Details

• The figure: Reuters reported that Qatari LNG exports plunged 96% from the beginning of the war through August, measured against the same stretch a year earlier. Shipments have been close to a standstill since Feb. 28, leaving the country's export program largely idle for roughly half a year.
• The chokepoint: Before the war, almost 20% of global LNG supplies passed through the Strait of Hormuz, the waterway that carries Qatari cargoes to Asian and European buyers. Gulf LNG remains trapped inside the Gulf even as regional crude flows have returned to near-normal volumes.
• Passage with Iran: Qatar's Prime Minister Sheikh Mohammed bin Abdulrahman Al Thani told UK journalist Piers Morgan that the few cargoes that cleared Hormuz did so after buyers themselves negotiated passage with Iran. He did not identify which buyers reached those arrangements or on what terms.
• Force majeure: State-owned QatarEnergy has reportedly extended force majeure for customers in Asia and Europe, the contractual clause that suspends delivery obligations when circumstances are beyond a supplier's control. The company has not set an end date for the measure or said when normal loadings might resume.
• Price effect: The extension is driving prices higher and intensifying competition among buyers for alternative supplies, with Asian and European customers chasing the same replacement cargoes. Neither the volumes withheld under force majeure nor the contracts affected have been disclosed.
• Europe's storage: Europe has not been able to replenish its gas stockpiles this summer, the season when importers normally build inventories ahead of peak demand. That shortfall will likely translate into higher utility bills for European households this winter.
• Crude divergence: Middle East crude exports have nearly recovered to prewar levels, a recovery that has not extended to gas. Oil tankers have resumed moving through the region while LNG carriers, which require dedicated terminals and long-term contracts, remain sidelined.

Background

The US-Iran war disrupted traffic through the Strait of Hormuz, the passage linking Gulf producers to global markets. Qatar's exports effectively stopped on Feb. 28, and QatarEnergy has since kept customers in Asia and Europe under force majeure.

Between the lines

The gap between recovered crude flows and frozen LNG shipments points to a structural difference rather than a security one: oil can be rerouted and resold, while Qatari gas depends on fixed terminals and long-term contracts through a single waterway. The prime minister's account of buyers negotiating their own passage suggests commercial workarounds are being handled cargo by cargo, not restored at the route level.

What's next

Watch whether QatarEnergy extends force majeure again beyond its current term, European storage levels heading into winter, and any move to formalize passage arrangements through Hormuz beyond individual buyer deals.

Source: Semafor Gulf, Reuters