Chevron Australia President Expects LNG Prices to Remain High for About Six Months
Business & MarketsWell-covered
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The Facts
- Chevron Australia President Balaji Krishnamurthy expects LNG prices to stay high for about six months.
- The U.S.-Iran war has disrupted global LNG supply.
- Qatari LNG shipments through the Strait of Hormuz have largely dried up since the conflict began.
- Disrupted contracted supply has pushed Asian LNG buyers toward the spot market.
- India, Pakistan, Bangladesh, Thailand and Vietnam have spent $7.4 billion on spot LNG since the war began.
- Higher LNG costs are prompting some Asian buyers to reconsider long-term reliance on imported LNG.
Context
Why are LNG prices elevated?
Supply disruptions associated with the U.S.-Iran war have reduced Qatari LNG shipments through the Strait of Hormuz and increased demand for spot-market cargoes. Business Standard Straits Times Anadolu Ajansı
Who is most exposed to the higher prices?
Import-dependent Asian buyers, including India, Pakistan, Bangladesh, Thailand and Vietnam, have turned to the spot market after contracted Qatari supply was disrupted. Economic Times Business Standard Straits Times
Why does Australia matter in this market?
Chevron's Australia president said Australian LNG carries a premium because of its proximity to Asian markets. Bloomberg Business
Where Left and Right agree, and where they split
- Where Left and Right agree
- Contracted LNG supply collapsed after Hormuz shipments dried up, forcing Asian buyers into a $7.4 billion spot-market scramble that both sides treat as a real, unwelcome cost.
- Where Left and Right split
- The left and right agree on the squeeze but split over ending the war or rerouting supply.
- Why they won’t converge
- Even agreeing on the $7.4 billion spent and the six-month price outlook, the sides split on values: whether the burden is an inequity to be corrected by ending import dependence, or a geographic risk to be managed by rerouting supply outside the Strait of Hormuz.
How left and right read it
The bill for this war is landing on household budgets in India, Pakistan, Bangladesh, Thailand and Vietnam, which have already spent $7.4 billion on spot cargoes because contracted supply collapsed and Qatari shipments through Hormuz dried up. Six more months of high prices is not a market wobble; it is a transfer of wealth from import-dependent economies to sellers. No wonder some buyers are rethinking imported gas. That rethink should be the priority, alongside ending the conflict driving the squeeze.
Energy security is geography, not goodwill. Qatari cargoes through Hormuz have largely dried up since the war began, so Asian buyers lost contracted supply and were pushed onto the spot market, spending $7.4 billion across India, Pakistan, Bangladesh, Thailand and Vietnam while prices are expected to hold high for roughly six months. Some are already rethinking reliance on imported LNG, and the fix is supply that never transits that strait, locked in under long-term contracts.
Every spot cargo bought this year is buying something else too: a rethink of where Asia's gas comes from.
The receipts — all 26 sources
Wire services (1)
Independent coverage (25)
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