Analysis: LNG trade disruption worries ease as Qatari flows to Suez, Egypt resume

14 Jun 2017   Qatar

Singapore (Platts)–13 Jun 2017 719 am EDT/1119 GMT

* Qatargas vessels transit Suez for Ras Laffan

* Egypt gets Qatar LNG despite blockade
* Limited impact of UAE’s port restrictions
* Qatar Petroleum: “business as usual”

Concerns over the impact of diplomatic blockade on Qatar on LNG trade flows eased this week, following deliveries of Qatari LNG into Egypt and the transiting of several Qatari vessels through the Suez Canal, a key transport route for Middle East LNG shipments to the European markets. ┬áThis came as a relief to LNG traders, who were caught off guard last week when two Qatari cargoes destined for the UK via the Suez Canal turned around off the coast of Yemen and diverted towards South Africa’s Cape of Good Hope, raising fears Egypt might have restricted access to the waterway. ┬áMarket experts, however, argued the diversion was likely a move by the Qatari government to avoid transiting the Suez Canal and paying US dollar-denominated canal fees to Egypt, among those to have cut diplomatic ties with Qatar.

Chart: Qatari LNG exports in 2016

“It was likely Qatar’s decision to turn away the two cargoes rather than Egypt’s,” said an Atlantic-based LNG trader.

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