LNG buyers, sellers target supply diversity

Buyers of liquefied natural gas are seeking new sources of supply amid the US-Israel conflict with Iran, which is curbing shipments from the Gulf. According to The Express Tribune, importers are turning to producers in West Africa and Indonesia, among others. Asian governments are also trying to lock in cargoes from sellers that can draw on several origins.

Producers and trading firms, for their part, want to widen their supply pools by buying stakes in gas projects and sourcing from more countries, according to officials and executives at last week's Gastech conference. Thailand's state firm PTT is looking to Oman, North America and West Africa, while its trading arm signed a long-term supply agreement with Equinor of Norway on Friday. Bangladesh, which relied on Qatar for most of its LNG before the Strait of Hormuz was effectively shut, now looks to Indonesia, Australia and China.

Shell's Tom Summers puts the net supply loss this year at around 5 million tons, or 1% to 1.5% of global supply, despite losing 36 million metric tons from the Middle East. New capacity additions help explain the smaller figure, and 70 to 80 new LNG vessels each year add shipping flexibility, he said. Speakers also said high prices and demand for varied supply have improved prospects for Argentina, East Timor and Tanzania.