A potential blockade by Iran of shipping transiting through the Strait of Hormuz could send the global LNG market into disarray and particularly impact Asia, according to Energy Intelligence.
A full-scale Iranian blockade of maritime traffic through the Strait remains a low-probability, worst-case scenario for most market sources polled by the company.
But if the ongoing conflict in the Middle East escalates further – Iran’s IRGC seized an ‘Israeli-linked’ ship near the Strait last month, according to Al Jazeera – the global LNG market would struggle to offset the loss of volumes exported from the region and its impact would likely be higher than when Russia stopped pipeline gas to Europe, potentially triggering new price highs.
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