Qatar extends force majeure notices on LNG supply to Edison, Asian clients including Bangladesh
Qatar is among the Iran conflict's biggest economic casualties, with its liquefied natural gas exports slashed by 96%, Reuters calculated at the end of August.
Highlights:
- Edison says it will not receive LNG cargoes until early December
- Clients in Asia told force majeure extended to November, sources say
- Edison holds long-term contract with QatarEnergy
QatarEnergy has extended force majeure notices and will not be able to deliver liquefied natural gas cargoes to Italian utility Edison or some Asian clients as the Strait of Hormuz remains closed, Edison and trading sources said today (28 September).
Edison, one of the company's biggest customers in Europe, will not receive LNG cargoes until the beginning of December, the Italian group said on Monday, in the latest extension under a force majeure notification first issued in April following disruptions caused by the US-Iran war.
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Clients in Asia, including in Bangladesh and Pakistan, were also informed that force majeure notices had been extended until November, two trading sources said.
QatarEnergy did not immediately respond to a request for comment.
Qatar is among the Iran conflict's biggest economic casualties, with its liquefied natural gas exports slashed by 96%, Reuters calculated at the end of August.
While neighbouring Gulf exporters have managed to ship oil secretly out of the Strait of Hormuz, Qatar had exported just 18 LNG cargoes until end-August, down from 509 in the same period last year, according to data intelligence firm ICIS.
Winter season will fuel competition for limited supply
With the winter heating season starting within days, buyers in Europe will have to look elsewhere to refill gas storage inventories ahead of the coldest months of the year.
That will fuel competition with Asian clients for the limited available global supply, and keep gas prices elevated.
While Italy is confident it will meet the European Union's target for its gas buffer, several countries, including Germany, are rushing to fill their storage tanks.
In a message on an Italian energy markets platform, Edison said QatarEnergy would cancel a further six LNG cargoes, taking the total undelivered shipments to 35.
The Italian subsidiary of France's EDF has replaced 23 cargoes so far, turning mainly to US suppliers to make up for missing deliveries from the Gulf.
Edison holds a long-term contract with QatarEnergy for the supply of 6.4 billion cubic metres of natural gas per year to Italy, around 10% of the country's total consumption.
The contract, which has been in force since 2009, has a total duration of 25 years.
