QatarEnergy extends LNG force majeure, charters tankers through October, sources say

• Force majeure notices to South Korean and Indian buyers, originally set to expire in August and early September, have been extended until mid-September with expectations of further extensions possibly until October
• QatarEnergy has sub-chartered at least nine LNG carriers from its fleet of nearly 70 vessels to third parties including Chevron, BP, and Cheniere on 30-90 day spot deals despite falling freight rates
• The company has shut liquefaction trains and suspended exports due to Iranian actions in the Strait of Hormuz, with the prolonged disruption threatening global LNG supplies during peak winter demand season

Summary: QatarEnergy Extends LNG Force Majeure Amid Hormuz Strait Closure

Key Developments:

QatarEnergy has extended force majeure declarations on liquefied natural gas (LNG) deliveries to Asian buyers and is chartering out tankers through mid-October, indicating prolonged export disruptions due to the ongoing Iran conflict and closure of the Strait of Hormuz.

Critical Facts:

• Force majeure notices to buyers in South Korea and India, originally expiring in August/early September, have been extended to mid-September, with possible further extensions to October
• QatarEnergy has shut down liquefaction trains and suspended exports due to the Iran war and renewed Iranian actions on tankers in the strait
• At least nine QatarEnergy-controlled LNG carriers have been sub-chartered to third parties including Chevron, BP, EnBW, Cheniere, Kansai, SOCAR, LMCS, and Trafigura
• Vessels are being leased on 30-90 day spot deals despite falling freight rates

Market Impact:

Qatar represents approximately 20% of global LNG trade, making this disruption significant. A prolonged outage threatens to tighten supplies and elevate prices for Asian buyers ahead of the northern hemisphere winter heating season.

Analysis:

Wood Mackenzie's Ikram Elloumi noted that QatarEnergy is "prioritising fleet utilisation over waiting for a market recovery" by leasing vessels in a weakening freight market. QatarEnergy operates a fleet of nearly 70 LNG carriers but has only chartered out several vessels to date.

Company Response:

QatarEnergy did not immediately respond to requests for comment on the extended force majeure or tanker chartering activities.