Qatar Energy Company (QE) has purchased 33 ships of spot liquefied natural gas from the United States this year, which are being shipped to South Korea, Taiwan, Bangladesh, India, and Japan to alleviate the impact of the disruptions in shipping through the Hormuz Strait.
According to reports from industry sources cited by Reuters, following the blockage of shipping through the Hormuz Strait due to the conflict in Iran, Qatar Energy Company has declared “force majeure” on its liquefied natural gas transportation business, but has significantly increased its purchases of US natural gas spot cargoes to ensure supply to some of its customers.
After the outbreak of the US-Iran conflict, Iran closed shipping lanes in the Hormuz Strait, resulting in a disruption of 20% of global oil and gas supplies.
Despite the “force majeure” declaration relieving Qatar Energy Company of its contractual obligations, the company has increased its purchases of US liquefied natural gas spot cargoes from 4 ships last year to 33 ships. This year’s purchase volume represents one-third of the company’s monthly export volume before the US-Iran conflict, valued at around $1 billion.
A source revealed that around 80% of Qatar’s liquefied natural gas exports go to Asia, and this move by Qatar Energy Company is seen as a “gesture of goodwill” towards some key customers, aiming to uphold its established commercial reputation over the decades.
Another source added that Qatar Energy Company wants to demonstrate its importance to certain customers and is working diligently to ensure supply to these customers.
The sources further disclosed that some of these natural gas spot cargoes were purchased directly from the US producer Venture Global LNG, while others were acquired from some of the company’s customers.
Venture Global LNG declined to comment on the matter.
Data analysis company Kpler indicated that out of the 33 spot cargoes, 28 ships have been delivered, with the remaining 5 ships en route to South Korea, Taiwan, and India.
In recent years, with conflicts in the Middle East and the Russia-Ukraine war, the United States has become the world’s largest exporter of liquefied natural gas. The demand for alternative supplies in the market has benefited US producers like Venture Global LNG.