Islamabad: Pakistan has received the latest shipment of liquefied natural gas from Qatar, passing through the Strait of Hormuz, which offers some relief for the country under strain for energy supplies.
The deal with Iran enabled the LNG carrier to transship over the weekend in the strategic waterway, Bloomberg reported. The tanker filled up its cargo at Qatar’s Ras Laffan port in late June and is expected to arrive at the LNG import terminal in Pakistan on Tuesday.
The shipment will be the second Qatari LNG cargo for Pakistan this month. The first, which arrived on board Al Marrouna, came through Port Qasim earlier in September, also passing through the Strait of Hormuz.
The new cargo, on the LNG tanker Shandong Redwood, passed through the Hormuz strait on September 19 and left the Gulf, Reuters reported. Kpler and LSEG ship-tracking data indicated that the ship was moving towards Pakistan.
The passage is occurring as commercial shipping through Hormuz is well below normal. Only 17 commodity vessels crossed the waterway over the weekend, compared with 37 vessels a week ago, Reuters said. The strait used to accommodate some 125 large commercial ships per day before the war.
The recent shipment is significant for Pakistan, which heavily depends on imported gas for power production and various other industries. Earlier this month, Reuters reported that Pakistan’s power sector may need up to 400 million cubic feet of gas a day over the winter months, but at that time, only a few LNG cargoes were confirmed for September.
Spot market purchases have also become very costly due to the LNG shortage. Pakistan had earlier been looking at purchasing more cargoes following disruption in its contracted supplies, but with high international prices, the emergency procurement is proving difficult.
Earlier this month, Pakistan had turned down costly spot LNG offers, as government struggled to deal with the pressure emanating from disruptions around the Hormuz, Business Recorder reported. So a successful delivery from Qatar helps to lessen the need for another expensive spot market purchase.
LNG is not the only application for the energy pressure. Pakistan’s oil prices are also rising due to the regional instability impacting on the key shipping lanes. On Sunday, Petroleum Minister Ali Pervaiz Malik cautioned that in the event of a serious shortage, the price of petrol could hit Rs1,000 per litre, though he said the country was not facing a fuel shortage.
This new cargo will not solve Pakistan’s long-term supply problems. A fresh closure of the Strait of Hormuz would once again cause delays in LNG supplies, increase procurement prices and exert pressure on the country’s power market.
The government of Pakistan will thus be closely monitoring its arrival. A successful delivery would give some short-term breathing space, but stable supplies of LNG would require conditions to remain in the Gulf and access to the strategic waterway.
