LNG Flows Through Hormuz Spike to Seven-Month High Amid Conflict

The number of liquefied natural gas (LNG) cargoes exiting the Strait of Hormuz rose to its highest monthly level since the US-Israeli war on Iran began in February. In September, a total of 19 LNG cargoes were shipped through the key waterway, made up of 13 from Qatar and six from the United Arab Emirates.

This is a significant increase from June's figure of 15, when a pact between the US and Iran had started to take effect, according to Eric Yep, a senior principal analyst at S&P Global Energy. The acceleration in LNG transits through the Strait of Hormuz could see full-month transits recover to 25% of pre-war levels if maintained into October.

Data from Kpler shows that more QatarEnergy-linked liquefied natural gas vessels have transited the strait in recent weeks, despite the conflict. Three more LNG vessels carrying cargoes from Qatar's Ras Laffan export terminal reappeared outside the waterway this week, with two of them being QatarEnergy-linked.

The key concern is whether LNG transits through Hormuz can be sustained through winter, as it hinges on whether Iran would resort to more serious military escalation if higher exports through Hormuz are perceived as loss of leverage in its control of the strait. Shipping convoys under US naval escorts may continue despite the high cost.