Qatar LNG exports interruption longest since 2008, Eurasia begins "gas grab" battle

Qatar Ras Laffan Liquefied Natural Gas Facility Has Been Zero Export for Five Consecutive Days, Setting a Record Since at Least 2008. The resulting global LNG supply crisis is reshaping trade patterns—ships originally heading to Europe are turning toward Asia, sparking an intercontinental bidding war.

The ripple effects of the Middle East conflict are rapidly spreading to the global energy markets. According to Bloomberg vessel tracking data, since the outbreak of conflict, at least eight LNG ships scheduled for Europe have rerouted to Asia, and this trend has recently accelerated. Meanwhile, a smaller LNG export facility in Abu Dhabi is also unable to ship normally, with combined supply shortfalls accounting for about 20% of global LNG supply. Gas prices in Europe and Asia have surged significantly over the past week, raising inflation and economic concerns.

Under multiple pressures, the previously widely expected LNG oversupply in 2026 has nearly vanished. Florence Schmit, an energy strategist at Rabobank, said:

“Even with increased US supply, the market is now facing shortages. The timeline for LNG oversupply has been pushed back by a full year.”

Five days of zero exports, longest shutdown in history

According to Bloomberg analysis of Kpler vessel tracking data, no fully loaded LNG carriers have departed from Ras Laffan in five days, a situation that has not occurred since at least 2008. Since the US and Israel launched strikes on Iran on February 28, no LNG ships have passed through the Strait of Hormuz.

The shutdown was triggered by an attack last week involving Iranian drones on the facility. Although Ras Laffan temporarily used tank inventories to load several cargoes after shutdown, the last cargo departed last Friday, and there have been no exports since.

Based on Bloomberg’s estimates using 2025 production data, each additional day of interruption effectively causes about three batches of Qatari LNG to disappear from the market. Most of Qatar’s supply goes to Asian importers, who are seeking alternative sources or directly reducing supplies to fertilizer plants, industrial users, and other end customers.

Ship rerouting, limited spot competition between Europe and Asia

The tense competition for global LNG sources has begun to alter actual flow directions. According to Bloomberg vessel tracking data, at least eight LNG ships originally scheduled for Europe have rerouted to Asia, with this trend especially evident in recent days.

Europe faces urgent pressure—after a winter of consumption, its gas storage levels have fallen sharply, and it needs to replenish before summer. Meanwhile, in Asia, many regions expect higher-than-average temperatures, and air conditioning demand over the coming months will continue to boost natural gas consumption.

Bloomberg New Energy Finance data shows that last week, global LNG imports totaled 8 million tons, down 26% from the previous week; at the same time, LNG supply decreased by 16%. Buyers in India, Bangladesh, and Thailand have turned to spot markets to replenish inventories, but some March delivery tenders (including those from India) have failed due to seller shortages and high prices.

Rystad Energy analyst Mathieu Utting warned: “If this situation persists for several months into the deep summer, there will be no sufficient alternative LNG sources to meet global demand.” He pointed out that the other two major LNG suppliers—the US and Australia—are operating near full capacity, with little room to increase utilization.

Oversupply expectations fall short, Morgan Stanley and others downgrade outlook

The impact of the supply disruption on market supply-demand dynamics is gradually being re-priced by mainstream institutions. Devin McDermott, an analyst at Morgan Stanley, noted in a research report: The bank previously forecast a 6 to 8 million ton oversupply in the LNG market this year, but if Qatar’s shutdown lasts more than a month, the market will “quickly shift to a shortage.”

Florence Schmit from Rabobank provided a more specific timeline: each week of Qatar’s production halt is expected to reduce the anticipated surplus by about 1.5 million tons. At this rate, the market could turn from surplus to deficit within five weeks. Additionally, QatarEnergy’s decision to delay a major expansion project will further pressure supply throughout 2026.

Limited US incremental capacity, short-term new projects unlikely to fill gap

As the world’s largest LNG exporter, the US faces significant doubts about whether it can timely fill the supply vacuum. Although several new facilities are under development, capacity releases will be gradual and unlikely to provide effective short-term replacements.

The Golden Pass project in Texas, a joint venture between Qatar and ExxonMobil, is nearing completion but has not yet begun commercial operation. Cheniere Energy’s Corpus Christi facility is still expanding, and Venture Global is advancing the capacity ramp-up at the Plaquemines project in Louisiana, along with building a third project, CP2.

All these new supplies are medium- to long-term strategies; they are unlikely to support the currently tightening spot market in the short term. Rising spot procurement costs are straining cash flows in emerging markets, and if the shutdown continues, the risk of localized shortages will increase further.

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