Gulf LNG Suppliers Face Price Pressures as Regional Risk Rises

Global liquefied natural gas (LNG) buyers are seeking lower prices and additional supply guarantees from Qatar and the UAE, following a US-Iran war that has disrupted insurance costs on deliveries through the Strait of Hormuz.

The war has weakened the negotiating power of Gulf producers, which had previously been considered the most reliable suppliers due to their proximity to Asian markets and low production costs.

Qatar's vast reserves have made it a dominant force in the global gas market, with its LNG priced competitively at around 12.6-12.7 percent of the Brent crude price before the Iran war.

However, buyers say the higher risk and rising insurance costs will give them leverage to drive down costs further and request more flexibility in future negotiations.