Tankers Flock To Qatar As Global LNG Supplies Stretch Thin
The global LNG supply has witnessed a severe crunch just ahead of winters in the Northern Hemisphere. The shortfall has prompted tight competition between Asian and European buyers for LNG cargoes to meet domestic demands.
Qatar, which accounts for more than one-fifth of global LNG supply, is witnessing heavy traffic of Asian buyers at its ports. We conducted a thorough analysis of tablet activity in and around Ras Laffan, and identified close to a dozen tankers waiting at the port for their turn for replenishment of supplies.
The global shortage of supply in LNG is becoming an increasing worry among several countries. Many fear harsh and prolonged winters, especially in Europe which mainly depend on Russia for their supplies.
Many blame the inadequate replenishment of LNG storages over the summer of 2021. In Europe, reservoir capacities have fallen by more than 16% of the five-year average. Russia has also made similar claims.
Many in industry base the increasing preference of Qatar as a supplier among Asian buyers, on the expansionist policies of Qatar Petroleum, the producer, and Qatar Gas, the operator of facilities. Qatar by far is the lowest charging exporter of LNG.
In times when the global prices have surged by more than 35% in the last month due to supply crunch, policies providing low-cost LNG supply over long periods have been gaining popularity. South Korea and Pakistan, leading consumers of LNG, are also turning to Qatar for their supplies.
Qatar Petroleum recently signed a deal with Pakistan to provide LNG at a significantly lower price of 10.2% slope of Brent crude oil in a bid to dominate global LNG supply.
European countries are expected to face the brunt of shortage and increasing dependability on Russia if the winter is harsh whereas Asian countries seem to be speeding ahead in securing stalks based on their bilateral ties with exporters like Qatar.