Key Takeaways
- QatarEnergy has extended force majeure notices for LNG deliveries.
- Italian utility Edison and some Asian clients will not receive LNG until December.
- The Strait of Hormuz remains closed, affecting Qatar’s exports.
QatarEnergy has extended force majeure notices, impacting deliveries of liquefied natural gas (LNG) to Italian utility Edison and some Asian clients, including Pakistan. The extension follows disruptions caused by the US-Iran conflict, which has closed the Strait of Hormuz, a critical maritime route for Qatar’s exports.
Edison, one of QatarEnergy’s largest European customers, will not receive LNG cargoes until the beginning of December, according to the Italian group. This is the latest extension under a force majeure notification first issued in April, as reported by trading sources.
Two trading sources informed that clients in Asia, such as Bangladesh and Pakistan, have also been notified of extended force majeure notices until November. QatarEnergy did not immediately respond to a request for comment.
Qatar, a major casualty of the Iran conflict, has seen its liquefied natural gas exports slashed by 96 percent, according to Reuters calculations. By the end of August, Qatar had exported only 18 LNG cargoes, down from 509 in the same period last year, as reported by data intelligence firm ICIS.
With the winter heating season starting within days, buyers in Europe will have to look elsewhere to refill gas storage inventories ahead of the coldest months. This will fuel competition with Asian clients for the limited available global supply, keeping gas prices elevated.
Italy is confident it will meet the EU’s target for its gas buffer, but several countries, including Germany, are rushing to fill their storage tanks. In a message on an Italian energy markets platform, Edison said QatarEnergy would cancel a further six LNG cargoes, taking the total undelivered shipments to 35.
The Italian subsidiary of France’s EDF has replaced 23 cargoes so far, turning mainly to US suppliers to make up for missing deliveries from the Gulf. This shift in supply sources highlights the impact of the force majeure on global LNG markets.
While the Strait of Hormuz remains closed, Qatar’s ability to export LNG is severely hampered. The situation is expected to continue affecting energy markets and prices in the coming months.
