Liquefied natural gas exports to Asia and Europe stand to be most impacted if the Strait of Hormuz is closed due to the ongoing war in the Middle East, according to analysts from Vortexa, an energy market analytics firm.
A fifth of the world's LNG transits through the Strait of Hormuz, a narrow stretch that lies between Oman and Iran, according to Vortexa. Several tanker owners, oil majors and trading houses have suspended crude oil, fuel and liquefied natural gas shipments via the Strait of Hormuz after the US and Israel attacked Iran and Tehran said it had closed navigation, sources said on Saturday.
"There's no spare capacity in the LNG market, so the disruption could be immediate and immense," Claire Jungman, Director of Maritime Risk and Intelligence at Vortexa, said.
Over 90 per cent of Qatar's LNG exports pass through the strait, putting Asian buyers most at risk: 25 per cent of Asia's total LNG supply and 30 per cent of China's LNG flow through this point, she said
If Qatar, the world's second-largest LNG supplier, is disrupted, Asia bears the brunt since 80 per cent of its cargo goes there. China, India, Taiwan and South Korea are the most exposed, Jungman said
Regional exports are already being hit; Israel has suspended exports to Egypt, Iran's gas flows to Turkey are at risk, and Qatar has halted LNG production
Europe is at risk, with European Union gas storage 35 per cent below its five-year average and the lowest since the 2022 energy crisis, leaving little buffer against a major supply shock, Jungman said
(Reporting by Siddharth Cavale in New York; Editing by Matthew Lewis)