Pakistan is set to receive an LNG cargo from Qatar after having negotiated with Iran the safe passage of the shipment through the Strait of Hormuz, sources familiar with the deal told Bloomberg on Monday.
This would be the second Qatari LNG cargo that the energy crisis-stricken Pakistan would receive in September after some carriers managed to move out of the Persian Gulf early this month.
The latest LNG shipment cleared the Strait of Hormuz this weekend and is set to arrive in Pakistan by Tuesday, per ship-tracking data compiled by Bloomberg.
The cargo would not be the first time Pakistan has directly negotiated safe passage for LNG with Iran—the South Asian country did so in May, too, as it scrambles to secure gas and curb blackouts.
Pakistan, which relied mostly on Qatari term supply before the war, has had to turn to expensive spot purchases which have pushed its power generation costs higher.
Pakistan has been struggling to keep the lights on after Qatar declared force majeure on its exports following Iranian strikes that caused damage to its Ras Laffan LNG export hub. Since then, Pakistan has been forced to turn to spot LNG markets and pay hefty premiums for the occasional shipment.
This summer, Pakistan has been paying top dollar for LNG supply as the renewed closure of the Strait of Hormuz and the stranding of cargoes from its term supplier Qatar have forced the South Asian country to seek liquefied natural gas on the spot market.
The latest Qatari LNG shipment would ease Pakistan’s energy crunch and spare it at least one much more expensive spot purchase.
Some LNG cargoes from Qatar and the United Arab Emirates have recently transited the Strait of Hormuz or engaged in ship-to-ship transfers outside the Strait offshore Oman. The uptick in LNG cargoes managing to exit the Strait of Hormuz signals that the LNG exporters in the Persian Gulf are intensifying efforts to have supply push through the chokepoint after months of near-total halt of shipments.
By Tsvetana Paraskova for Oilprice.com
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