Qatar’s state-run energy firm said Monday it had halted liquefied natural gas production following Iranian attacks on facilities at two of its main gas processing bases. Qatar accounts for 20% of global LNG exports, all of which transit the Strait of Hormuz. Ras Laffan, one of the targeted sites, is the world’s largest single LNG facility.
Global gas prices soared Monday, with Dutch TTF natural gas contract, considered the European benchmark for LNG prices, jumping almost 45%. Oil too was on the boil. Brent crude futures rose 13% to $82.37 a barrel, highest since Jan 2025, before retreating to trade up $4.92, or 6.75%, at $77.79 a barrel late morning in US.
The company said, “Due to military attacks on QatarEnergy’s operating facilities in Ras Laffan Industrial City and Mesaieed Industrial City, QatarEnergy has ceased production of liquefied natural gas and associated products.”
Earlier, Qatar’s defence ministry said one Iranian drone “targeted an energy facility in Ras Laffan Industrial City, belonging to QatarEnergy”, referring to the firm’s onshore gas processing base 80km north of Doha.
Another “targeted a water tank belonging to a power plant in Mesaieed”, the statement said, referring to an area 40km south of the Qatari capital, a key site for Qatar’s natural gas production. The Gulf state is one of the world’s top LNG producers, alongside the US, Australia and Russia.
Jamie Ingram, managing editor of Middle East Economic Survey (MEES), said the halt was “an unprecedented development, with Ras Laffan the largest single LNG facility on the planet,” warning there was “scope for prices to rise significantly”.
He said the move was “made from an abundance of caution rather than one forced by the scale of the drone attack earlier today”.
“It’s possibly also intended to drum up international support,” Ingram added.
While Iran has not officially closed the Strait of Hormuz, through which around 20% of global seaborne oil passes, its Revolutionary Guards have warned against transiting the waterway, leaving it effectively shut.
In recent years, Qatar has inked a series of long-term LNG deals with India’s Petronet, France’s Total, Britain’s Shell, China’s Sinopec and Italy’s Eni among others.
“While we do not know where these disruptions will end or how the conflict will ultimately resolve, the nearterm result is likely to be heightened volatility in global energy markets and a potential rerouting of global oil and gas cargoes,” said Kenny Zhu, research analyst at Global X.
He said the North American energy complex was well positioned to hedge these disruptions should there be any lasting impacts on global energy trade, however.
Oil’s surge on the restart of trading after the weekend was smaller than some had expected. On Sunday, some analysts had predicted oil would open above $90 a barrel.
On Monday, Saudi Arabia shut its biggest domestic oil refinery after a drone strike. The widening Iran conflict also left 150 ships stranded at anchor around the Strait of Hormuz after a seafarer was killed and at least three tankers were damaged. Much of the crude oil from some of the largest producing countries, including Saudi Arabia, Iraq and Iran, is shipped through the Strait.
