A Qatari LNG tanker is travelling through the Red Sea braving waters susceptible to attacks from Houthi rebels, Bloomberg reported on October 19.
Commercial vessels have largely been avoiding sailing through the Red Sea, instead choosing to take the longer route around Africa’s Cape of Good Hope for deliveries to Europe, which can add as much as two weeks to the journey.
The vessel is signaling Poland as its next destination. QatarEnergy possesses a supply deal with Poland’s state-run Orlen. However, LNG cargo shipments from the Gulf company were cancelled when it declared force majeure in March following Iran’s attack on its Ras Laffan Industrial Complex.
The journey through the Red Sea is highly dangerous for commercial tankers. UK Maritime Trade Operations reported on October 17 that an LNG vessel was fired on by a skiff southeast of Al Mukalla, a Yemeni port city. The vessel returned two shots at the skiff.
Europe is currently dealing with low inventory levels in its gas storage with forecasts predicting it will end the April-October restocking season only 76% full, the FT said, citing Wood Mackenzie. That could put Europe at its lowest pre-winter level since at least 2011, based on Gas Infrastructure Europe (GIE) data.
Europe’s low storage levels come at a time when the continent is competing with buyers in Asia for LNG cargoes at sky-high prices amid around one-fifth of the global LNG supply being sidelined by Iran’s closure of the Strait of Hormuz.
Some European buyers, such as Italy, have been notified by QatarEnergy that deliveries on LNG supplies will be cancelled until at least early December. European customers have been relying heavily on US LNG on the spot market to make up for some of the supply lost from Qatar and the United Arab Emirates being sidelined.
Related Articles