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Oman’s Minister of Energy and Minerals, Salim Al-Aufi, has called for the Middle East to develop alternative routes for liquefied natural gas (LNG) exports that can bypass the Strait of Hormuz, as regional conflict continues to disrupt energy shipments.
Speaking at the Gastech conference in Thailand on Monday, Al-Aufi said Gulf energy producers should explore different options for transporting gas out of the region.
“Let’s identify alternative export options,” Al-Aufi said, according to Bloomberg. He pointed to possible routes running north, through Oman or via Yemen, arguing that greater diversification would reduce dependence on a single strategic waterway.
The Strait of Hormuz is a critical route for global energy trade, and disruptions linked to the conflict involving the United States, Israel and Iran have sharply reduced LNG exports from the Persian Gulf.
Developing alternative export corridors, however, would require major investments in new pipelines and other infrastructure. Such facilities could also become potential targets for drone and missile attacks, particularly following recent Yemeni strikes targeting Saudi Arabia’s East-West pipeline.
Oman Increases LNG Output
Oman has become an increasingly important LNG supplier during the disruption. The country produces more than 11 million tons of LNG annually, and its LNG facilities have been operating at exceptionally high levels this year to help compensate for reduced supplies from Qatar.
Qatar had been the region’s largest LNG producer before the latest disruptions. A July report by MEES said Oman LNG was producing at a rate above the combined nameplate capacity of its three LNG trains, which is around 11.4 million tons per year.
The increase highlights the pressure on regional LNG producers to maintain supplies while shipping routes remain vulnerable.
LNG Prices Expected to Stay Elevated
The disruption is also putting continued upward pressure on global LNG prices.
Balaji Krishnamurthy, president of Chevron’s Australian operations, told Bloomberg that he expects LNG prices to remain high for at least another six months.
“I have a hard time seeing the prices come down,” Krishnamurthy said, suggesting that supply constraints and uncertainty surrounding Middle Eastern exports could keep the market elevated.
Qatar is also looking for additional supplies. Reuters reported earlier that QatarEnergy has been seeking LNG deals with U.S. producers to compensate for domestic supply losses caused by damage from Iranian strikes.
According to sources cited by Reuters, QatarEnergy is considering long-term agreements extending through 2031. The move indicates that the recovery of the company’s Ras Laffan LNG facilities could take considerable time.
If Gulf production and export infrastructure remain disrupted, global LNG markets could face an extended period of tight supply and elevated prices.
