Qatar crisis: what’s the impact on LNG trade? Report

Insight 16 June 2017

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Report summary

Qatar, the largest LNG exporter in the world, is embroiled in a diplomatic row with Saudi Arabia, UAE, Bahrain and Egypt. Qatar packs a very large punch in the LNG market accounting for almost 30% of LNG supply in 2016. Of the protagonists the UAE and Egypt import LNG from Qatar, although together they only accounted for 6.5% of Qatari LNG exports in 2016. So far there is no evidence that there have been any issues with Qatari LNG production. There is little sign of panic in the market with LNG prices and freight rates seeing little or no change. We have analysed some of the concerns about the situation raised in LNG circles including: • Egypt and UAE’s LNG imports; • access to the Suez Canal; • passage through the Strait of Hormuz; • bunkering operation in Fujairah; and • the impact of disruptions to the wider supply chain to the operation of the LNG plants at Ras Laffan.

Executive summary
- Qatar LNG in context – the world’s largest exporter
- United Arab Emirates – piped gas more important than LNG
- Egypt – traders might need to get creative
- Suez Canal – likely to remain open to Qatari ships
  - Qatar LNG export routes
- Strait of Hormuz – unlikely to be an issue
- Bunkering/Ship Operations – minor inconvenience
- Supply chain disruptions – could impact operations
Further reading
Appendix

Tables and charts

This report includes the following images and tables:

Qatar LNG exports by destination region (mmtpa)
Qatar LNG exports by destination region (%)
Qatar LNG exports by destination (2016)

Ships required to move 1 mmtpa of LNG from Qatar to various destinations
Ships required to move 1 mmtpa of LNG to UAE and Egypt from various sources
Qatar crisis: what’s the impact on LNG trade?: Image 4
Suez Canal LNG traffic (annual)
Voyage time and ships required to move 1 mmtpa of LNG from Qatar via Suez and via the Cape