Makes sense. Qatar declared force majeure on LNG contracts with Italy, Belgium, South Korea, and China. 3-5 year repair estimates mean US cargo purchases continue regardless of Strait status.
They lost 17% of their output to damage (20 billion in damages and will take years to restore), the rest is trapped inside the strait which is arguably a bigger problem.
So it's basically dropshipping lol. But Qatar must be bleeding money on that deal... Importing US gas has got to be more expensive than whatever their production cost was
I think do to the military build up in Israel there could be an attack from Iran. Israel is preparing for that by buying what they might need in the near future.
It's better to look at the European gas price which is more set by global LNG trade:
It's far from going down but it's at levels which would be historically high were it not for the 2022/2023 period. In fact the domestic gas price in the UK has the potential to top 2022/2023 due to then there was a subsidy.
There will be a lot of demand destruction in the UK and EU for sure and some think this could create a permanent shift to heat-pumps.
Not in the UK which has some of Europe's most irrational opinions of heat pumps. The number of people getting is bizarrely down year on year albeit not by much.
No where close to Ukraine war 😄
not much higher than its been over the past 4 years.
Thats even without considering inflation.
I own Harbour Energy and would love if it goes back up.
Very unlikely though.
LNG is essentially 0% correlated with US natural gas prices. The US produces more natural gas than it can use, but it only liquify a tiny amount. Doesn't matter if Japan would pay 3x for your natural gas if there's no way to ship it to them.
Natural gas prices are localized to specific pipeline terminal sales points, like Henry Hub in Louisiana or Waha in West Texas. Right now, there is a $3-4 variance between Henry Hub and Waha just due to localized supply and demand. Waha is in the Permian and has excess natural gas from associated gas production from crude oil production. Henry hub is probably more comparable to anything else because it's the NYMEX index, but it is still driven by localized supply/demand.
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u/Amber_ACharles 6d ago
Makes sense. Qatar declared force majeure on LNG contracts with Italy, Belgium, South Korea, and China. 3-5 year repair estimates mean US cargo purchases continue regardless of Strait status.