Shanaka Anslem Perera, an independent financial market researcher, had his post today widely shared. Perera wrote: "At this moment, a liquefied natural gas (LNG) carrier that was originally bound for European receiving stations, departing from Qatar, is turning its course toward Asia."
This is not due to military orders or sanctions, but simply because a Japanese utility company offered a price $4 per million British thermal units higher than the German buyer in the original contract. After calculating the accounts, the ship owner changed course.
On March 2nd, Iranian drones attacked facilities of Qatar Energy in Ras Laffan and Mesaieed Industrial City. Qatar declared a force majeure situation. This largest global LNG exporter has now halted production, and 20% of the world's LNG supply vanished from the market in one afternoon.
About 12% of Europe's natural gas is imported from Qatar, while the Nord Stream pipeline has been completely shut down since September 2022. Now, the natural gas needed by Europe for heating, power generation, and chemical industries is almost entirely supported by maritime LNG. The ships carrying this natural gas only head to the highest bidder.
Asia is precisely that high bidder. In normal years, 80-85% of Qatar's LNG is sold to China, Japan, South Korea, and India. These buyers are backed by national support, and their purchases have strategic significance. Their pricing confidence comes from survival considerations, not quarterly profit goals. Within 48 hours of Qatar's shutdown, the spot price of LNG in Asia surged to $23.8 per million British thermal units, a three-year high, and the TTF natural gas price in Europe also jumped 50% during the same period.
This is not merely a supply disruption, but a civilization-level energy auction taking place on the high seas, where Europe is losing out to buyers with stronger sovereign balance sheets and shorter supply chains.
The real accounting is unyielding: Europe's current natural gas inventory is about 60%, which is normally expected for March. However, the stockpiling season from April to October is approaching. Every bit of natural gas needed to increase Europe's inventory to 90% for next winter now has to compete with China's strategic reserve purchases, Japan's panic buying, and South Korea's stockpiling to avoid industrial power cuts. Every LNG carrier that changes course from Rotterdam to Yokohama means less supply for Europe's inventory; every additional week of Qatar's shutdown makes Europe's stockpiling plan harder to achieve.
Although the United States can expand its LNG exports and is taking action, shipping capacity has become a hard constraint. The number of LNG carriers worldwide is fixed, and now each one is being bid on by buyers - everyone knows that the heating security this winter depends on the shipping rates determined this week.
This war, intended to eliminate Western energy security threats, has caused the most severe energy supply disruption in the West since the 1973 oil embargo. LNG carriers were not seized or sanctioned, but simply outbid by higher prices. These bidders are Asian economies that the United States needs to cooperate with on all other strategic issues.
Vessels are turning, prices are the compass, and Europe has nothing to offer that can convince the ocean otherwise.
Original article: toutiao.com/article/1858968195692552/
Statement: This article represents the views of the author alone.