Qatar’s Minister of State for Energy Affairs Saad bin Sherida Al Kaabi said the country’s liquefied natural gas production had begun to recover gradually but remained below normal levels, forecasting a return to normal production rates within a few weeks amid the fallout from the crisis linked to the Strait of Hormuz.
Speaking at the Qatar Economic Forum in partnership with Bloomberg in New York, Al Kaabi said Qatar was currently producing enough to meet its electricity needs and those of some petrochemical industries, while exports continued at levels far below normal.
Force majeure and export commitments
Al Kaabi said current conditions had prompted Qatar to declare force majeure with respect to some export commitments, stressing that the country was handling its contracts in line with the exceptional circumstances and was keen to honor its obligations to customers whenever conditions allowed.
He said reopening the Strait of Hormuz was an important factor for the movement of equipment and supplies linked to energy projects, warning that continued shipping restrictions could delay some projects.
Pressure on prices and inventories
Al Kaabi warned that the continued closure of the Strait of Hormuz could increase pressure on energy markets amid rising prices for gas, fuel and many commodities. He said gas prices in Europe had reached high levels, while some inventories had been drawn down during the summer because of higher temperatures and increased air-conditioning use.
He added that the arrival of winter, combined with continued pressure on supplies, could deplete inventories in Europe and Asia, potentially putting renewed pressure on prices.
Al Kaabi said Qatar had managed to meet the needs of its customers worldwide without delay for about 30 years, explaining that current conditions sometimes exceeded producers’ ability to control them. Doha is aiming to return to normal production and export levels as global demand for liquefied natural gas continues to grow.
Expansion and investment projects continue
Al Kaabi said Qatar was continuing to expand its investments in projects in several countries, including Namibia, Cyprus, Angola, Brazil and Argentina, as well as through partnerships with global energy companies. He added that a new project would begin within weeks, with gas production expected to start next year and the year after.
He said drilling work on the eastern line was continuing, with exports expected to begin next year. The projects were proceeding according to plan, he explained, although the arrival of some equipment could be affected by shipping conditions in the Strait of Hormuz.
Al Kaabi forecast that market needs would rise by about 27% through 2030 despite growing competition from US production. He also reaffirmed Qatar’s continued interest in investing in different energy markets, including Venezuela, saying talks were under way with partners on potential investments there.
