Europe loses LNG cargoes to Asia as Middle East conflict tightens supply

Europe is losing liquefied natural gas (LNG) cargoes to Asia as conflict in the Middle East disrupts Qatari facilities and drives prices higher.

Italy, Poland and Belgium are scrambling to secure alternative supply sources in an increasingly competitive market.

European buyers are being priced out of the global LNG market as Asian importers outbid them for limited cargoes.

Shipping data show multiple tankers altering course mid-voyage, with roughly a dozen Atlantic shipments already redirected.

The competition for LNG is escalating as the Strait of Hormuz, a critical energy transit chokepoint responsible for around 20% of global LNG supply, remains closed by Iranian authorities in retaliation for missile strikes by the US and Israel about a month ago.

Taiwan says it has 11 days of gas reserves

Supply disruptions intensified after attacks on Qatar’s Ras Laffan facilities forced the world’s largest LNG producer to declare force majeure on contracts with Belgium, Italy and Poland on Tuesday.

Europe accounts for only a small share of supply flowing through this bottleneck and is largely focused on managing rising prices and easing LNG shortages in several countries. By contrast, Asian economies rely on the Strait of Hormuz for roughly 80% of their energy imports.

Taiwan, a key semiconductor producer, said on Tuesday, March 24, that it has enough gas reserves to last 11 days.

According to data from intelligence firm Kpler, the number of LNG tankers changing course has continued to rise since the outbreak of war in the Middle East on February 28. The latest Qatari cargoes are expected to reach the UK and Italy by March 27.

Laura Page, head of LNG and gas at Kpler, said in remarks to Euronews:

“We have 11 LNG cargoes confirmed to have been redirected from Europe to Asia, as well as two redirected from Europe to Egypt and one from Europe to Türkiye.”

The disruption has pushed global LNG prices higher at a critical moment as Europe enters its gas storage replenishment season, raising concerns that Atlantic supply will tighten further.

Page said: “Fortunately, the winter heating season is ending, so gas demand will decline. However, the crisis poses significant risks for Europe during the upcoming storage refill season and could leave the region vulnerable next winter if storage levels fail to recover sufficiently.”

Gas benchmark rises above 60 euros intraday

Europe’s benchmark wholesale gas price, the Dutch TTF, closed Tuesday at around 53–54 euros per megawatt-hour (MWh), after rising above 60 euros earlier in the day.

Although slightly below midweek peaks, prices remain well above pre-conflict levels.

Asian buyers are currently paying about $1–3 per MMBtu more than their European counterparts for spot LNG, based on the JKM benchmark. This relatively small but decisive premium is reshaping global trade flows.

Higher returns are incentivising traders to divert flexible cargoes eastward, where shipping economics are more attractive, leaving Europe competing for constrained LNG supply.

Italy turns to Algeria for diversification

Italian Prime Minister Giorgia Meloni visited Algeria on Wednesday as Rome seeks to offset disrupted Qatari supplies, which account for roughly 30% of the country’s annual gas demand.

A study published Tuesday by think tank ECCO suggests Italy could replace Qatari LNG within a year through renewable energy expansion and energy efficiency measures.

ECCO argues that installing 10 gigawatts of new renewable capacity annually could reduce gas consumption by 2.5 billion cubic metres, equivalent to 40% of Qatari imports.

Additional measures include improving energy efficiency across residential, commercial and industrial sectors, as well as electrification. However, these steps would still rely on Algerian gas to bridge the remaining gap.

The study states: “For the remaining 15%, equivalent to 1 billion cubic metres annually out of a total 6.4 billion cubic metres, the government could utilise existing gas infrastructure, particularly pipelines linking Italy to Algeria.”

Belgium and Poland expect limited impact

In Belgium, supply disruptions from Qatar are expected to be relatively modest, affecting around 8% of LNG imports via the Zeebrugge terminal.

The country’s transmission operator Fluxys said it is actively seeking alternative supplies and expects shipments from the US, Nigeria and Russia.

However, imports from Russia are scheduled to be fully phased out by 2027, narrowing long-term options.

Poland’s oil and gas company Orlen said the suspension of some LNG production by QatarEnergy, which accounts for less than 10% of its demand in 2025, does not pose a threat to national gas security.

Orlen highlighted its diversified supply portfolio and flexible trading tools as key mechanisms for offsetting potential supply losses.

US issues trade ultimatum to EU

Meanwhile, the US has renewed pressure on the European Union, leveraging rising energy prices and potential supply shortages.

US Ambassador to Europe Andrew Puzder warned that if EU lawmakers reject the terms of the EU-US trade agreement due to be voted on today, the bloc could risk losing “favourable access” to LNG supplies from across the Atlantic.

Puzder told the Financial Times:

“If they don’t accept the deal, I don’t know what will happen on energy. I think the US will want to continue doing business with Europe, but the terms may not be as favourable. The environment certainly won’t be as favourable. And there are other buyers in the market.”

Under the agreement expected to be signed soon, the EU27 is projected to purchase around $250 billion annually in oil, gas and nuclear energy from the US by 2028, with total purchases reaching approximately $750 billion.