Pakistan Weighs Direct LNG Imports Amid Energy Crisis

Pakistan's government is considering allowing power plants and private firms to directly import liquefied natural gas (LNG) from the spot market to ease its energy crisis. The country has been struggling with an energy shortage since Qatar declared force majeure on its exports following Iranian strikes that damaged its Ras Laffan LNG export hub.

The Energy Ministry has proposed easing existing regulations to allow private companies to directly import LNG, which has long been the domain of state-owned importer Pakistan LNG Ltd. However, spiking spot LNG prices amid the Hormuz supply crunch have put a strain on the government's energy import bill and finances.

Pakistan relied mostly on Qatari term supplies before the war but has had to turn to expensive spot purchases since then, pushing its power generation costs higher. The country has been paying top dollar for LNG supply this summer due to the renewed closure of the Strait of Hormuz and the stranding of cargoes from Qatar.

Qatar extended the force majeure on LNG deliveries to Asia and Europe by another month through the end of November, as LNG cargo traffic through the Strait of Hormuz remains largely blocked amid the protracted U.S.-Iran stalemate over the chokepoint.