Five days after Saudi Arabia, Egypt, Bahrain, and the UAE severed diplomatic relations with Qatar, and closed land and sea ports, major global firms that receive Qatar’s liquefied natural gas (LNG) have said that their supplies have not been affected.
Although there are four countries competing for the title of largest LNG exporter, Qatar has maintained the lead, being the top LNG producer and exporter in the world with 78 million tonnes annually, equivalent to 10.3 billion feet of gas per day, according to Bloomberg.
Japan is Qatar’s largest gas importer, receiving one-third of international cargos under long-term contracts. South Korea is a close second.
Qatar provides about a third of global demand for LNG, and is a major source of condensates, a very light type of crude oil and liquefied petroleum gas (LPG).
After diplomatic relations were broken off on Monday, Russia said it did not have any fears about oil and gas supplies.
The Organization of Petroleum Exporting Countries (OPEC) have cooperated before despite diplomatic rifts, a Russian source said, noting that Russia plans to discuss Qatar’s situation in the Monitoring Committee meeting between OPEC members and independent producers.
On Wednesday, the Kremlin negated the rumours that Russia could buy back the stake purchased by Qatar in Rosneft. The Qatar Investment Authority (QIA) also denied such rumours.
Officials in the Indian Ministry of Petroleum and Natural Gas, on Monday, held talks with their Qatari counterparts to ensure that this political dispute will not impact gas supplies to India.
A few hours after several Arab nations decided to boycott Qatar, Japan’s JERA Co. Inc., the largest LNG buyer, said it had been informed by Qatargas that the situation will not impact its LNG supplies.
After breaking ties, natural gas prices rose as futures increased 2.05%, reaching $3.04 for each British thermal unit (Btu).
Companies say supplies continue
In the third day of the rift, ExxonMobil said that LNG production and exports from Qatar were not affected, noting that most of the company’s production in Qatar is sold through long-term contracts.
On Thursday, natural gas prices continued to rise, with futures adding 1.4% to $3.099 per Btu.
Qatar’s crude oil exports have not been affected by the closing down of several seaports by Arab countries, Reuters reported.
Singapore’s Trafigura on Wednesday said that the political conflict between Doha and a number of Arab countries did not affect the level of Qatari gas imports.
Firms suspend sea transport
On another note, Maersk said it could no longer transport goods to or from Qatar. "We have confirmation that we will not be able to move Qatar cargo in and out of Jebel Ali," a Maersk Line spokesperson said Tuesday.
Taiwan-based Evergreen Company and Hong Kong's OOCL announced on Wednesday they had suspended shipping services to Qatar after Arab countries severed diplomatic ties with the Gulf country and imposed port restrictions.
Evergreen, the world's sixth biggest container shipping line, announced in separate statements that it had temporarily suspended services to and from Qatar until further notice.
Similarly, OOCL, the world's seventh largest carrier, attributed its decision to the current political climate in the region.
By Eman Ghaly; Translated by Mohamed Hesham Azab
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