Five months after military strikes involving the US, Israel and Iran triggered a wider regional conflict, the Atlantic Basin liquefied natural gas (LNG) market remains under significant pressure, with supply disruptions and elevated prices continuing to reshape global trade flows.
According to S&P Global Commodity Insights, Platts DES Northwest Europe (NWE) LNG prices jumped 63% to $15.479/MMBtu on March 2 following the initial strikes. Prices have since climbed further, reaching $20.746/MMBtu on July 22, the highest level in more than three years and just 24 cents/MMBtu below the Dutch Title Transfer Facility (TTF) gas benchmark.
The last comparable price surge occurred in January 2023 during the Russia-Ukraine conflict, underscoring the scale of the current supply shock.
Strait of Hormuz disruption tightens global supply
Market participants say three key developments have driven LNG prices higher: the effective closure of the Strait of Hormuz, force majeure declarations at QatarEnergy’s Ras Laffan LNG complex, and intensified competition between Asian and European buyers for Atlantic Basin cargoes.
Before the conflict, an average of three LNG carriers departed the Persian Gulf each day, according to S&P Global Energy CERA. Since early March, however, tanker traffic through the Strait of Hormuz has largely halted, with traders reporting little to no LNG vessel activity.
Analysts noted that while some vessels may attempt crossings without transmitting tracking signals, confirmed attacks on commercial shipping have significantly increased operational risks. One notable incident occurred on July 6 when the QatarEnergy-chartered LNG carrier Al Rekayyat was struck while transiting the Strait.
The security situation has also driven war-risk insurance premiums sharply higher. Industry sources estimate premiums have ranged between 3% and 10% of cargo value, adding as much as $2.10/MMBtu to shipment costs, although rates have eased slightly from their peak.
Qatar supply outage reshapes LNG trade
Supply pressures intensified after a drone attack on QatarEnergy’s Ras Laffan LNG facility in early March, prompting the company to declare force majeure on LNG deliveries.
QatarEnergy has since extended the declaration several times, including for shipments to Italy’s Edison, leaving uncertainty over when exports will return to pre-conflict levels.
Prior to the conflict, Qatar accounted for nearly 28% of global LNG exports, shipping approximately 6.28 million metric tonnes in February 2026. At its peak, the country supplied around 32% of global LNG production, making the disruption one of the largest shocks to the LNG market in recent years.
Asia and Europe compete for US cargoes
The reduction in Qatari exports has been felt most acutely in Asia, where Qatar previously supplied almost a quarter of LNG imports.
To offset the shortfall, Asian buyers have increased purchases from the United States. Through July 30, Asia imported 1.7 million metric tonnes of US LNG, representing more than 17% of total US LNG exports during the month.
US producers have responded by exporting record volumes, with shipments reaching 65.9 million metric tonnes in the first half of 2026, nearly 25% higher than a year earlier.
Europe has also turned increasingly to US cargoes but faces stronger competition from Asian buyers. European imports of Qatari LNG fell to 2.39 million metric tonnes during the first half of 2026, compared with 5.4 million metric tonnes over the same period last year.
Italy, historically Europe’s largest importer of Qatari LNG, received no Qatari cargoes during July, reflecting the broader disruption across the continent.
Tight market expected to persist
Despite recent diplomatic discussions, traders say market fundamentals remain constrained and are unlikely to improve in the near term.
Platts assessed September DES NWE LNG at $19.557/MMBtu on July 30, remaining only slightly below TTF futures prices, indicating continued supply tightness.
Industry participants expect Qatar’s LNG production to recover only gradually, with some forecasting the country may operate at roughly 75% capacity in 2027. S&P Global Energy CERA projects Qatari LNG exports of about 6.3 million metric tonnes by January 2027.
With limited new LNG export capacity expected globally before 2027 and storage levels lower than normal ahead of winter, traders believe prices will remain elevated until supply disruptions ease and regional tensions subside.
