QatarEnergy declares force majeure on LNG shipments amid Gulf conflict

QatarEnergy has declared force majeure on liquefied natural gas (LNG) deliveries to customers following the suspension of production at its facilities, the state energy company announced on March 4.

The company said it had notified all affected purchasing customers of the declaration, adding that it "values its relationship with all relevant parties and will continue to communicate with the available information."

Qatar is the world's largest LNG exporter, shipping approximately 80mn tonnes per year to customers across Asia, Europe and the Americas. A prolonged suspension of Qatari LNG output would have severe consequences for global energy markets, particularly for European countries that have increased their dependence on Qatari gas since pivoting away from Russian supplies following the invasion of Ukraine.

The force majeure declaration follows weeks of Iranian strikes on Qatari territory, including attacks on the Al Udeid air base, the largest US military facility in the Middle East.

Iran's IRGC said in its opening retaliatory wave that it targeted US radar installations in Qatar, while subsequent strikes have continued to hit military and infrastructure targets across the Gulf state.

The disruption to Qatari LNG supplies compounds the impact on global energy markets already reeling from the effective closure of the Strait of Hormuz to tanker traffic. Iran has claimed to have struck and sunk multiple vessels transiting the waterway since the conflict began on February 28.

Oil prices have surged since the outbreak of hostilities, with analysts warning crude could exceed $150 per barrel. The loss of Qatari LNG volumes is likely to send natural gas prices sharply higher in both European and Asian spot markets.