The U.S. and Israeli war against Iran has changed the global market for liquefied natural gas (LNG), providing a boost to producers outside the Middle East that…
The U.S. and Israeli war against Iran has changed the global market for liquefied natural gas (LNG), providing a boost to producers outside the Middle East that will likely last long after the current conflict ends.
One of the major beneficiaries is Australia, which last year slipped to the third-largest exporter of the super-chilled fuel behind the United States and Qatar.
But the effective closure of the Strait of Hormuz has shut off Qatar's LNG exports, meaning that it will likely lose second place back to Australia this year, even if the narrow waterway is re-opened and shipments resume.
The obvious short-term boost to Australia's LNG producers is through higher prices, with Asian spot assessments LNG-AS doubling since the U.S. and Israeli aerial campaign started on February 28.
Spot LNG for delivery to North Asia ended at $19.30 per million British thermal units (mmBtu) in the week to March 27, down from a four-year high of $25.30 the prior week, but almost double the $10.40 from the week to February 27.
The surge in spot prices, and indeed in crude oil-linked long-term contracts, will bolster the profits of Australia's LNG producers.
With several of Qatar's LNG plants damaged by Iranian attacks
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