Asia is likely to face LNG supply disruptions because of state-owned QatarEnergy's (QE) production halt, as well as shipping restrictions in the strait of Hormuz resulting from the US-Iran conflict.
QE halted production of LNG and associated products on 2 March after drone attacks on its facilities. But there has so far been no confirmation on whether QE has issued a force majeure on its supply to customers. An average of 89pc of Qatar's LNG exports went to Asia in 2025.
Qatar is home to the 77mn t/yr Ras Laffan LNG export terminal and is the world's second-largest exporter of LNG. Even a 20pc reduction in QE's production capacity for the duration of a week would result in a loss of about four cargoes.
At the same time, vessel traffic in the strait of Hormuz — where about 20pc of global LNG supply passes through — has come to a virtual halt since the US and Israel began attacks on Iran. If vessels remain unable to transit through the strait after a week, this would lead to a shortage of about 21 cargoes in global supply, assuming full production capacity.
Argus has so far determined there is about 1.056mn t of LNG loaded onto 13 vessels, but which is trapped in the Mideast Gulf west of Hormuz as of 3 March, according to data from ship-tracking firm Kpler. There are also three empty vessels potentially ready for loading whenever QE's production restarts.
India
India is set to be one of the most affected countries because of its rising reliance on Mideast Gulf LNG. State-run Gail and Petronet have informed their downstream customers that there will be curtailment in supply from 3 March onwards, traders said.
Only one out of three of Petronet's captive LNG carriers has managed to unload at India's 17.5mn t/yr Dahej terminal. The 138,000m³ Disha, carrying 60,000t of LNG, was loaded on 1 March but continues to wait around Ras Laffan LNG terminal, sources told Argus.
Two out of four of Indian state-controlled gas distributor Gail's time charters are on course to India, travelling across the Atlantic basin. The other two are en route to Europe to unload cargoes.
Indian LNG importers have so far not issued any tenders to seek alternative supplies as prices have risen sharply.
State-controlled Gujarat State Petroleum (GSPC) issued a tender on 28 February seeking a delivery over 22-30 March. But it is unlikely that it has received any bids for the tender.
The supply shortage is likely to most affect India's fertiliser and city gas distribution network, while power demand can likely be fully covered by coal. India's gas-fired power capacity stands at 20.1GW, accounting for about 4pc of total power generation, according to power ministry data.
Northeast Asia
South Korea's climate and energy ministry has activated an emergency energy response task force in preparation for potential supply risks driven by the US-Iran conflict.
Japan's supply of electricity and gas is still stable, and there will be no short-term impact from the conflict, the country's trade and industry ministry (Meti) minister said on 3 March, but it may consider spot procurement or co-ordination of supplies if necessary.
Imminent spot purchases as a result of the production halt is hence unlikely, sources said. Importers will likely continue to wait for further instructions from the government and will consider discussions with existing term contract suppliers, sources said.
