Pakistan moves to review LNG supply contracts with Qatar amid declining domestic demand

Pakistan and Qatar have begun reviewing their long-term LNG supply agreements as domestic demand falls. According to The Express Tribune, the two sides agreed to redirect 24 cargoes to other markets in 2026. PSO and QatarEnergy have each issued price review notices under two intergovernmental deals that end in 2031, and PSO is awaiting federal approval before going ahead.

The first agreement, SPA-I, runs for 15 years from 2016, while the second, SPA-II, was signed under the PTI government and covers 10 years from 2021. Together the two contracts provide 6.75 million tonnes annually, which amounts to 108 cargoes. Under these terms, QatarEnergy keeps profits from overseas resales, whereas PSO absorbs any losses.

QatarEnergy issued its SPA-II price review notice on March 7, 2026, and PSO served its SPA-I notice on March 19. Clause 15.2 of SPA-I permits renegotiation from March 1, 2026, the agreement's tenth anniversary, with any revised price covering only the remaining term. If no deal is struck within six months, either party can bring the contract to an end at the close of the year in which notice was issued. That leaves Pakistan with the options of seeking a lower price, keeping existing terms, or terminating, though termination carries supply continuity risks.