Pakistan’s Energy Crisis Set to Ease as Qatari LNG Breaks Through Hormuz
Pakistan is set to receive tankers carrying Qatari liquefied natural gas this month, with the first cargo possibly arriving as soon as Thursday, Bloomberg reported based on ship-tracking data. The shipments follow a period in which Qatar declared force majeure after Iranian strikes damaged its Ras Laffan LNG facility, forcing Pakistan onto expensive spot purchases.
Why It Matters
Restoring Qatari cargoes could materially reduce Pakistan's elevated power-generation costs and help end prolonged rolling blackouts that have accompanied the country's recent gas shortfalls. The development also signals an easing of supply constraints that pushed Pakistan into high-priced spot markets.
Key Facts
- Expected arrival: Tankers carrying Qatari LNG are due to arrive in Pakistan this month; the first cargo could arrive as early as Thursday, per Bloomberg ship-tracking data.
- Cause of supply disruption: Qatar declared force majeure after Iranian strikes damaged the Ras Laffan LNG hub.
- Pakistan's interim procurement: Pakistan turned to spot LNG markets and paid large premiums for occasional shipments; Qatar had been the country's biggest LNG supplier under long-term contracts.
- Tender prices paid: Pakistan issued multiple prompt-delivery tenders over three months, often paying $20 per MMBtu or more.
- Failed tender offer: A recent tender closed without an order after receiving only one bid at $27 per MMBtu.
Pakistan expects shipments of Qatari liquefied natural gas to arrive this month, with Bloomberg reporting via ship-tracking data that the first cargo may dock as early as Thursday. The incoming deliveries come after months of supply disruption that forced the South Asian country to rely on sporadic, high-priced spot cargoes.
The interruptions began when Qatar declared force majeure following Iranian strikes that damaged its Ras Laffan LNG complex. Qatar had been Pakistan's largest long-term supplier of LNG, and the loss of that steady supply led Islamabad to seek prompt deliveries on the open market at significantly higher rates.
Pakistani state buyers issued several fast-delivery tenders over the past three months, frequently posting rates of $20 per million British thermal units (MMBtu) or above. One tender earlier this month failed to result in a purchase after the only offer received was $27 per MMBtu — roughly three times the pre-conflict prices Pakistan had been paying. A Pakistan LNG Limited executive cited the international LNG price at about $23.18 per MMBtu and contrasted it with the $26.969 per MMBtu bid, prompting a fresh tender.
Analysts and officials say Qatari cargoes should help ease the country's acute energy squeeze. Power-generation costs have climbed sharply — as of July they were 38% higher than a year earlier — and rolling blackouts lasting up to 24 hours have become common in some areas. That pressure has been exacerbated by spot-market price volatility and an extension of QatarEnergy's force majeure, underscoring that any improvement will depend on the pace and consistency of resumed supplies.
(Reporting based on Oilprice.com article by Irina Slav, with Bloomberg ship-tracking cited.)
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