Hormuz Conflict Redraws Global LNG Map as US and Iran Engage in Prolonged Struggle

The ongoing conflict in the Middle East has significant implications for global energy markets, particularly when it comes to liquefied natural gas (LNG) exports through the Strait of Hormuz. According to a recent report by the Center for Strategic and International Studies (CSIS), the prolonged struggle between the US and Iran could reshape the global LNG market. The report warns that disruptions in shipping and trade through the Strait of Hormuz, a critical waterway for Gulf energy exports, have already begun to cause damage to LNG infrastructure and impact global buyers.

Qatar is particularly vulnerable due to its heavy dependence on uninterrupted access through the Strait of Hormuz, with more than 25 Gulf energy companies declaring force majeure since the conflict began. The report estimates that Iran has conducted over 6,700 missile and drone attacks against Gulf states between February 28 and June 1.

The crisis has accelerated a structural shift in global LNG trade toward North America, with the US expanding its capacity rapidly. By 2027, an additional 52 million tons of new U.S. liquefaction capacity is expected to come online, potentially weakening Iran's ability to use Hormuz as an economic weapon.

The report also notes that this shift could have geopolitical implications for Washington, testing American military credibility and freedom-of-navigation policy in the face of rising competition from China and Russia.

Ultimately, the CSIS report suggests that the conflict may produce unintended strategic consequences for Iran by accelerating investment in non-Gulf energy supplies, reducing global dependence on the Strait of Hormuz. However, this could also allow Qatar to recover and compete aggressively with US LNG exports if shipping through the Strait becomes reliable again.