Pakistan LNG Ltd paid about $20.70 per MMBtu for a spot cargo, its priciest liquefied natural gas purchase in four years. The renewed Strait of Hormuz crisis has cut off term shipments from Qatar, forcing Pakistan back onto the spot market repeatedly.
State-controlled Pakistan LNG Ltd bought its most expensive spot cargo of liquefied natural gas in four years, after the re-escalation of the Hormuz crisis cut off cargoes from its term supplier, Qatar. The importer secured the cargo through a tender that closed on Wednesday, with delivery due early next week.
A four-year high on the spot market
Traders familiar with the deal said the cargo went for about $20.70 per million British thermal units. That was the highest Pakistan has paid on the spot market since 2022, when Asian spot prices spiked to record highs after Russia’s invasion of Ukraine slashed pipeline gas supply from Russia to Europe.
Pakistan has historically received nearly all its LNG from Qatar under long-term fixed deals. But it has hit procurement problems since the Iran war began and halted traffic through the Strait of Hormuz, forcing the country onto the spot market several times this year.
Qatari supply keeps falling short
The latest escalation could push Pakistan toward further costly spot cargo replacements for the supply that is not arriving from Qatar. As a result, the South Asian nation is on track to buy the most spot cargoes in a single month since the Iran war began.
Earlier this week Pakistan LNG issued its second spot tender in as many weeks, as renewed hostilities disrupted Qatari shipments again, with no LNG tankers observed exiting the Strait of Hormuz for days.
Source: OilPrice.com
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