Global LNG Exports Plummet to 6-Month Low Due to Middle East Conflict

Key Highlights

• Global liquefied natural gas (LNG) exports have declined to a 6-month low, with a 20% drop in the 10-day moving average for LNG shipments to 1.1 million tons since the start of the month.
• The decline is primarily attributed to Qatar and to a lesser extent the United Arab Emirates, both of which rely on the Strait of Hormuz to ship fuel to customers in Asia and Europe.

Impact of Middle East Conflict

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The ongoing conflict in the Middle East, particularly the war in Iran, is threatening to disrupt the LNG market. Recent attacks on Qatar's LNG export plant in Ras Laffan, the largest in the world, have forced the facility to shut down. A recent strike last week damaged the facility, and it will take years to repair two of the plant's 14 production trains.

Global LNG Market Trends

LNG output around the world had been steadily rising over the past year, driven primarily by new projects in the US and Canada. However, this growth is being offset by the loss of Qatari LNG and the effective closure of the Strait of Hormuz, a key waterway for about a fifth of LNG supply.