Asian and European buyers of liquefied natural gas (LNG) plan to ask for lower prices and additional supply guarantees from Qatar and the United Arab Emirates as the U.S.-Iran war raises insurance
Asian and European buyers of liquefied natural gas (LNG) plan to ask for lower prices and additional supply guarantees from Qatar and the United Arab Emirates as the U.S.-Iran war raises insurance costs on those deliveries, buyers, traders and industry executives told Reuters.
The war is reshaping the global energy industry, stripping Gulf producers of their reputation as the world's most reliable suppliers, which in the past gave them significant negotiating power. Their ability to set their own conditions has weakened because the war has halted most oil and gas flows through the Strait of Hormuz, the shipping chokepoint at the entry to the Middle East Gulf.
Qatar's vast reserves helped the country become the dominant force in the global gas market. It and the neighbouring UAE, where production volumes are increasing, account for around one-fifth of global LNG export capacity - all of which relies on the strait to reach global markets.
Qatari LNG has been among the most competitively priced due to the country's low production costs, while the UAE offers more flexible terms. However, buyers say the higher risk and rising insurance costs will give them leverage in future negotiations to further drive down costs and request
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