Pakistan is beginning to receive much-needed liquefied natural gas (LNG) deliveries after a period of significant supply disruption. The vessel "Al Marrouna," carrying Qatari fuel, successfully transited the Strait of Hormuz and is expected to reach Pakistan by Thursday. Another Qatari LNG carrier is anticipated to follow in the coming days. This development offers a crucial lifeline for Pakistan, which has been heavily reliant on Qatari LNG and has faced challenges since the US-Iran conflict began at the end of February.
The ongoing conflict and its impact on the Strait of Hormuz have significantly constrained Qatari LNG shipments, which previously accounted for approximately 20% of the global supply. This has forced developing Asian nations, including Pakistan, India, Bangladesh, Thailand, and Vietnam, into the volatile spot market. These countries have collectively spent an additional $7.4 billion on spot LNG since the war started, a substantial increase compared to the $3.1 billion they would have paid under long-term contracts in 2025 for a similar volume.
The disruption has prompted a reassessment of LNG's long-term viability in the region. Pakistan, once considered a high-growth LNG market, is now likely to increase its focus on solar and hydropower generation. Other Asian nations are exploring alternatives like renewables, coal, nuclear, or local gas production. The increased costs and supply insecurity are pushing countries to diversify their energy mix and reduce their dependence on LNG, potentially affecting future investments in the sector and challenging earlier projections of significant LNG demand growth in South and Southeast Asia.
