Asian LNG Spot Price Hits $21.35 as Qatari Outage Removes 12.8 Million Tonnes and Pakistan Cuts Imports 75 Percent

The Platts Japan Korea Marker benchmark settled at $21.35 per MMBtu on Tuesday, per S&P Global Commodity Insights, up 42 percent from roughly $15 per MMBtu in early May 2026. Henry Hub natural gas settled at $2.916 per MMBtu on Wednesday's CME close, per OilPrice.com. The JKM premium over US benchmark gas now stands at $18.43 per MMBtu. That spread has upended Asian LNG procurement and driven buyers toward coal and oil as replacement fuels.

Gulf Cargo Flow Has Collapsed

Only 26 LNG cargoes have departed Gulf export terminals since February 28, against a pre-crisis rate of 90 to 100 shipments per month, according to S&P Global. The Strait of Hormuz and the Bab el-Mandeb, which together handle a substantial share of global LNG transit, have been effectively closed by the ongoing US-Iran conflict and Houthi naval activity. Asian buyers account for roughly 90 percent of Middle East LNG output and bear the sharpest exposure to the supply collapse.

The Supply Void: Oil Authority Calculation

At the 95-cargo-per-month pre-crisis baseline, approximately 475 LNG cargoes were expected to depart Gulf terminals over the five months since late February. Oil Authority calculates the supply shortfall at roughly 450 cargoes. Each cargo averages approximately 3.4 million MMBtu, placing the aggregate shortfall above 1.5 billion MMBtu. Measured at Tuesday's JKM spot price, the replacement value of that absent supply exceeds $32 billion.

Ras Laffan Damage and Partner Exposure

Conflict-related damage at Ras Laffan Industrial City has taken Trains 4 and 6 offline, removing 12.8 million tonnes per year of LNG capacity from the global supply stack, according to S&P Global. QatarEnergy engineers have estimated a three-to-five-year repair timeline for those units. Pearl GTL Train 2, a gas-to-liquids facility at Ras Laffan, faces a separate one-year outage. ExxonMobil's $10.4 billion Barzan Gas Project, a joint venture with QatarEnergy at Ras Laffan, processes feedgas that supplies export capacity at the complex.

TotalEnergies holds equity stakes across multiple Qatargas trains at Ras Laffan, giving the French major direct exposure to the lost capacity from Trains 4 and 6. Its Integrated LNG segment supplies buyers across Asia and Europe, so the company faces constraints on incremental deliveries even as elevated JKM prices benefit its trading margins. The structural hole left by the Qatari outage cannot be filled quickly; existing LNG supply is contracted under long-term agreements, and new liquefaction projects take three to seven years to commission.

Demand Destruction Across Three Nations

Pakistan has cut LNG imports by 75 percent, according to ICIS, making it the most severely affected importer in the region. South Korea's LNG purchases fell 10 percent year-over-year, and China's declined 8 percent. India, Bangladesh, and Taiwan are significantly affected, according to Cindy Yeo, energy analyst at S&P Global. Physical LNG transactions through Platts' Market-on-Close process rose 77 percent year-over-year, while LNG derivatives volumes climbed 251 percent, per S&P Global, reflecting the intensity of the spot market scramble.

European Parallel and Market Stress Signals

European gas storage fell to 53 percent of capacity as of Wednesday, 27 percentage points below the EU's mandatory 80 percent winter target, as Oil Authority reported July 23. TTF settled at EUR 61.96 per megawatt-hour on Wednesday's ICE close, a 91 percent year-over-year increase that mirrors the JKM surge confronting Asian buyers. Both benchmarks reflect the same supply shock from Gulf LNG disruption, reaching two markets through two different pricing mechanisms. Analysts have described this as the weakest European storage position entering the second half of the year in 15 years, a deficit that compounds pressure on global LNG balances.

OilPrice.com cited James Taverner, a gas analyst, projecting that lost Qatari and UAE supply could "offset nearly all expected growth" in Asian LNG demand for 2026 if Hormuz restrictions persist through year-end. US LNG exporters routing shipments through the Cape of Good Hope hold a pricing advantage at the current JKM-Henry Hub spread of $18.43 per MMBtu. Brent crude settled at $100.65 per barrel on Wednesday's ICE close, up 6.99 percent on the day, making oil as an LNG substitute costlier for Asian power generators. QatarEnergy's three-to-five-year repair estimate for Trains 4 and 6 means the supply shortfall will not reverse quickly regardless of when the conflict subsides.