LNG exports from Qatar could be diverted and charter rates affected after Saudi Arabia, Egypt, Bahrain, the United Arab Emirates, Libya and Yemen said today that they have cut diplomatic ties with Qatar.
Shipowners and consultants were quick to point out that the world’s largest LNG producer Qatar sends cargoes to Dubai and Abu Dhabi in the UAE, and to Kuwait and Egypt. The tiny Middle East state also exports pipeline gas to the UAE through its Dolphin Gas Project and LPG.
Attention was focused on two LNG cargoes heading to Eqypt that are due to arrive this week.
Some asked if the Suez Canal would be closed to Qatari vessels including some of the huge Q-ship fleet owned by Qatar's Nakilat and on long-term charter to domestic LNG producers Qatargas and RasGas.
LNG market players suggested that the move could push up tonne miles for LNG cargoes as existing buyers are forced to source product from elsewhere.
"It could all be over in 10 days," one said, "but at the moment shipowners are looking for any excuse to raise [charter] rates."
The six Arab nations announced today that they are severing ties with Qatar – including maritime links – blaming the Qataris for backing militant groups including so-called Islamic State (IS) and al-Qaeda.
Qatar has denied the claims describing the move as "unjustified" with "no basis in fact".
