Qatar LNG Supply Disruptions May Persist for Months Despite Strait of Hormuz Reopening

Disruptions to global LNG supplies are expected to persist for several more months after QatarEnergy extended force majeure on additional cargoes destined for Italy. Italian utility Edison said four more LNG shipments scheduled for delivery to the Adriatic LNG terminal have been withheld, extending supply disruptions through early September despite the reopening of the Strait of Hormuz under the current ceasefire agreement.

The latest extension brings the total number of affected cargoes between April and early September to 21, equivalent to roughly 2.7 billion cubic meters of natural gas. The supply interruptions stem from force majeure declared by QatarEnergy in March after Iranian missile attacks damaged critical LNG production facilities during the regional conflict.

The attacks struck two LNG production trains at Ras Laffan, the world's largest LNG export complex, reducing annual production capacity by approximately 12.8 million tons, or about 17% of Qatar's LNG exports. The damage has also disrupted QatarEnergy's long-term agreement to supply 6.4 billion cubic meters of natural gas annually to Italy under a 25-year contract with Edison.

Edison said it has successfully secured replacement supplies for 14 of the 21 delayed cargoes and does not expect the disruption to affect deliveries to its end customers. However, QatarEnergy previously estimated that the damage to Ras Laffan could result in around $20 billion in annual lost revenue and require up to five years to fully repair.

Although oil and LNG tankers have gradually resumed operations following the U.S.-Iran ceasefire, market participants believe risks to global energy supplies remain elevated. Analysts noted that continued uncertainty surrounding diplomatic negotiations, combined with strong seasonal demand from Asia, is likely to keep LNG market fundamentals relatively tight through the summer.

Spot prices reflect those concerns. The benchmark Japan-Korea Marker (JKM) for LNG delivered to Northeast Asia remained well above pre-conflict levels in late June, underscoring the market's expectation that supply constraints could persist even as shipping activity gradually normalizes.

Lingering geopolitical risks continue to influence tanker movements as well. According to shipping data, at least two QatarEnergy-linked LNG carriers reversed course near the Strait of Hormuz last week after Iranian forces warned against unauthorized shipping routes and attacks were reported on commercial vessels operating near Omani waters.