QatarEnergy agreed on 29 October to buy 3 million tonnes a year (mtpa) of US LNG from Woodside's Louisiana LNG project for 20 years, with deliveries expected to start in 20301. The volume is about 18% of the plant's planned 16.5 mtpa capacity1. It follows two Cheniere agreements last week for up to 4 mtpa through 20542, 4.
Together the purchases add up to 7 mtpa of US supply in two weeks2. Saad al-Kaabi, QatarEnergy's chief executive, said they make the company the largest buyer of US LNG1. He told Reuters that more deals are coming and that the company's target is "much higher" than 7 mtpa2.
The hedge protects Qatar's revenue
"In a scenario where you have a closure of the strait, which is the true contingency that we're looking to have, you'd immediately see a spike in gas price and you'll be able to generate revenue for QatarEnergy that otherwise wouldn't be generated," Kaabi said2.
The plan needs no new plants or pipelines, he said, and relies on QatarEnergy's trading arm and a fleet of about 200 LNG tankers2. Kaabi said the company can profit from the gap between lower US gas prices and higher European prices2. Henry Hub, the US benchmark, settled at $2.76 per MMBtu on 27 October5. Platts assessed Asian spot for December at $30.761 per MMBtu on 22 October6.
Kaabi also addressed whether the US volumes can replace Qatari cargoes if Hormuz closes. They cannot, he said, because long-term customer contracts are point-to-point, requiring deliveries from specific export terminals to specific destinations2. A buyer whose Qatari cargo is hit by force majeure therefore has no claim on the US supply its seller has just bought2.
The shift is clear: the Gulf's largest LNG exporter is buying a revenue stream that does not depend on the strait2, 1.
Why Qatar is buying insurance now
QatarEnergy halted LNG production in early March after several days of Iranian missile attacks and declared force majeure to affected buyers on 4 March2. It has extended that force majeure until the end of 2026, according to Reuters and Bloomberg2, 1. The extension covers some buyers in Europe and Asia, ING noted on 29 October7.
Iranian missile strikes on the Ras Laffan gas processing site in March damaged two of Qatar's 14 LNG trains, with combined capacity of 12.8 mtpa, or about 17% of its export capacity2. Kaabi said repairs will take about three years, and QatarEnergy said in March the damage would cost about $20 billion a year in lost revenue2.
Even after a peace deal, Kaabi said Qatar could restart full production within a week if ships are available. Output would stay at about 83% of pre-war levels until the damaged trains return2. Qatar accounts for around a fifth of global LNG exports, all of which pass through Hormuz2. QatarEnergy has not said publicly which contracts the force majeure covers2, 1.
India's exposure is now price, not Qatari volume
India's problem this winter is price and contract terms, not the missing Qatari barrels. Imports rose 9% year on year in March to September. The US, Oman and Nigeria supplied about 68% of them, up from 25% a year earlier, Kpler data reported by The Economic Times show3. Qatar's share fell to 3% from 45%, and the UAE's to 8% from 14%3.
More than a third of India's LNG came from the spot market, where the Japan Korea Marker, the Asian benchmark, was around $30 per MMBtu3. Spot averaged $20 in March to September against $12 a year earlier, while oil-linked term supply would cost about $14 at Brent at $110 a barrel, the report said3.
Spot has climbed further since. Platts JKM rose above $30 per MMBtu on 19 October for the first time since December 2022, and the December contract was assessed at $30.761 on 22 October6. In Europe, TTF settled above €100 per MWh on 28 October, its first time above that level since 2022, then eased to €98 on 29 October7, 8.
Demand is not falling. Asia's October arrivals are forecast at 23.31 million tonnes, the highest since July9. EU storage was about 75% full on 28 October8. The EU will ban all imports of Russian LNG from 1 January 20276.
Indian gas users are already paying. Adani Total Gas raised CNG prices by ₹4.45 per kg on 23 October, citing LNG at about $30 per MMBtu against $10 to $12 in February and lower domestic gas availability10.
A longer queue for Atlantic cargoes
QatarEnergy's buying also changes the market Indian importers would use to replace Gulf supply2. Kaabi said the company is in talks with "everybody", including Venture Global, and Reuters reported last week that Venture Global is in advanced talks to supply 3 mtpa2.
US sellers have room to grow. Cheniere exported 188 cargoes in the third quarter, up from 163 a year earlier, and raised its full-year earnings guidance4. One million tonnes of the volume it signed with QatarEnergy depends on a final investment decision for the Sabine Pass expansion4.
Asian buyers will keep competing for that supply. Wood Mackenzie said buyers are diversifying across geography and counterparties after repeated disruption, and that a large share of future Asian demand remains uncontracted11.
India's own gateways limit how fast it can absorb more Atlantic cargoes. GAIL's Ratnagiri terminal runs at about 50% of its 5 mtpa capacity because a heating unit is not ready; the unit is due by June 202712.
Fertiliser is the second channel
Gas prices reach Indian buyers through fertiliser as well as fuel. The fertiliser sector drives India's LNG demand, and because fertiliser prices are not set by the market, higher costs add to the government's subsidy bill3. Urea imports rose 40.5% to 5.589 million tonnes in April to September13.
In Europe, high gas prices are cutting competing fertiliser production. Yara reported curtailments of ammonia output because of gas prices, and its European gas consumption fell more than 7% year on year in the third quarter, ING said7.
What to watch
Three decisions matter for Indian buyers. The first is whether a US-Iran peace deal holds; Kaabi's one-week restart assumes ships are available2. The second is whether QatarEnergy extends force majeure again past December2, 7. The third is whether Indian importers sign Atlantic term supply while US projects are still uncontracted11.