As supplies from Qatar through the Strait of Hormuz remain disrupted, Pakistan bought a liquefied natural gas shipment for delivery later this week at about twice the rate under the Qatari contracts, reported Bloomberg on Monday.
TotalEnergies SE sold a cargo for July 10-11 delivery to state-owned Pakistan LNG Ltd. for $17.37 per million British thermal units, read the report, citing traders with knowledge of the matter. It said that the shipment was bought in a tender that closed on Friday.
The Strait of Hormuz is a strategically vital waterway located between Oman and Iran, connecting the Mideast Gulf to the north with the Gulf of Oman and the Arabian Sea to the south. Before recent conflicts, approximately a fifth of global crude oil and liquefied natural gas (LNG) supplies, and a significant portion of other commodities like fertilisers, methanol, and sulfur, transited through this chokepoint.
Bloomberg said that the purchase marks Pakistan’s second spot gas procurement in two weeks as Islamabad seeks to replace cancelled Qatari supplies stuck in the Persian Gulf.
In early May, PLL invited bids for two LNG cargoes for delivery later that month. Bids were received, but the offers were rejected due to expectations that easing regional tensions could lower spot LNG prices and allow stranded Qatari supplies to resume.
Following the rejection of the earlier bids, PLL issued a new tender for two LNG cargoes, with delivery windows set for May 12-16 and May 24-28.