Ras Laffan under fire: what the strikes on the world's largest LNG hub mean for global gas markets

Please note: The figures shown below were accurate at the time of publication on 19 March and may have changed since. New information and datapoints are likely to have been released since.

The global LNG market faces its most significant supply disruption in decades. Missile strikes on Ras Laffan Industrial City—the nerve centre of Qatar's LNG export operations—have removed up to 19 million tonnes of supply from the global balance. We at Kpler break down what this means for traders, buyers, and the broader energy landscape.

Key takeaways

• Supply loss: Up to 19 Mt of LNG may be offline through end-May, with downside risk if damage assessments worsen
• Price impact: JKM spot prices have surged above $21/MBTU, with sustained $20+ levels likely through summer
• Regional dynamics: Europe and Asia will compete directly for Atlantic Basin cargoes, creating structural price tension through Q3
• Recovery timeline: War risk insurance signals—not official announcements—will provide the first indication of market reopening
• US-Iran context: Escalating US-Iran tensions underpin the conflict, with strikes on both Ras Laffan and Iran's South Pars field introducing shared reservoir risk

Impact of Ras Laffan strikes on LNG supply

What has happened

Overnight strikes on Ras Laffan have resulted in fires and extensive damage to LNG facilities. Ras Laffan processes gas from the North Dome—the world's largest natural gas reservoir—making it the single most important LNG export hub globally.

The full extent of damage remains unconfirmed. Unlike a Strait closure, which represents a logistical constraint, physical damage to LNG processing trains introduces a fundamentally different recovery dynamic:

• LNG trains cannot restart like oil wells
• Ramping production from a standing start requires sequential, train-by-train activation
• Full restart typically takes several weeks under normal conditions

The US-Iran dimension

The strikes on Ras Laffan occur within the broader context of escalating US-Iran tensions. This geopolitical backdrop has transformed regional energy infrastructure into potential targets, with implications extending far beyond the immediate conflict zone.

Strikes have also been reported on Iran's South Pars field, which shares an interconnected subsurface reservoir with Qatar's North Dome. The reservoir behaviour implications remain unclear, but this uncertainty has become a market variable in its own right.

LNG supply loss by region

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Total estimated loss: Approximately 19 million tonnes versus pre-conflict projections.

This figure carries significant uncertainty. Downside scenarios involving more extensive Ras Laffan damage, prolonged Strait mine clearance, or reservoir complications could extend the disruption well into Q3.

Geopolitical context: US-Iran tensions and energy security

The current crisis reflects the intersection of US-Iran strategic competition and global energy security. Several factors define this dynamic:

• Strait of Hormuz closure: The functional closure has curtailed all Middle Eastern LNG exports transiting this chokepoint
• South Pars/North Dome shared reservoir: Strikes on the Iranian side introduce risk to Qatar's long-term production capacity
• Iran-Turkey pipeline: Turkey imports approximately 8 BCM per year of Iranian pipeline gas, weighted towards summer months

Disruptions to Iranian gas infrastructure could prompt Turkey to seek replacement LNG cargoes, applying additional demand pressure to an already supply-constrained spot market.

Implications for the North Field expansion

Any confirmed impact on the shared reservoir would affect Qatar's ability to ramp production when export routes reopen. This could delay the North Field Expansion (NFE) Phase 1 timeline, currently scheduled for March 2027—a material shift in medium-term global supply projections.

Regional demand dynamics

Northeast Asia: inventory buffer provides short-term relief

Northeast Asian buyers enter the disruption in a comparatively comfortable position:

• China: LNG storage at approximately 51% by end-March
• Japan: Approximately 45% 
• South Korea: Storage above the five-year average, estimated at approximately 56%

This buffer allows Northeast Asian buyers to draw on existing inventories. The effect shifts their peak restocking season to June–July rather than April–May.

The risk: Deferred demand returns to the spot market precisely when European buyers compete aggressively for Atlantic Basin volumes. This collision could generate a sharp price spike in mid-summer.

Bangladesh has already paid approximately $21–22/MBTU for April-delivery spot cargoes—well above normal contract levels. This signals that term contract delivery from Qatar for April is being treated as unreliable.

Europe: facing its toughest restocking season

Europe enters the disruption at a structurally weaker starting point:

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Northwest Europe sits particularly low on storage. Even with better-than-expected end-March figures, the summer restocking requirement remains substantial.

Mitigating factors:

• Additional Atlantic Basin supply expected from the US, Mexico, and the Congo
• US export capacity increasing, with facilities signalling incremental expansion capability
• Europe will rely heavily on this Atlantic supply to underpin restocking

Atlantic Basin diversions: Europe vs. Asia competition

Since the conflict began, Kpler has tracked 11 LNG cargo diversions:

• Four Nigerian-origin cargoes redirected from Europe towards Asia
• Seven US-origin cargoes similarly diverted
• Total volume: Approximately 0.8 million tonnes

The underlying commercial logic driving diversions remains intact. JKM prices stay elevated, and Asian buyers pay spot premiums that outcompete European buyers for uncommitted volumes.

Market implication: As long as Asian spot prices remain at current levels, Europe and Asia will compete directly for Atlantic Basin supply. This structural tension will define global LNG pricing dynamics through at least Q3.

Price-sensitive importers face demand destruction

Colombia and similar markets face particular vulnerability:

• Heavy reliance on spot purchases
• Risk of being priced out as major buyers compete
• Likely outcome: fuel switching or demand destruction

The Russian LNG question

Despite the supply disruption's scale, Europe appears committed to eliminating Russian gas and LNG from its energy mix:

• New contracts for Russian gas and LNG now formally prohibited
• Target: full weaning off Russian pipeline gas by end of September 2027
• Russian LNG phase-out target: end of this year

This commitment creates genuine tension. Europe faces its highest-ever summer restocking requirement at precisely the moment when:

• Middle Eastern supply has been disrupted
• Atlantic Basin volumes face aggressive Asian competition
• A supply lever that would ease restocking has been politically removed

The result: Europe's restocking will be slower, more expensive, and more dependent on US and West African supply than at any prior point.

Market implications by participant type

For LNG traders

• The Europe–Asia arbitrage will remain highly active through Q3
• US and West African cargoes represent the swing supply
• Atlantic Basin diversion decisions will be the key price-setting mechanism

For buyers and portfolio managers

• Treat Qatar term contract reliability for Q2 as uncertain
• Build spot procurement strategies around $20+/MBTU price levels persisting through summer
• Monitor demand destruction signals in price-sensitive markets

For project developers and analysts

• Track NFE expansion timeline for any delay announcements
• Monitor South Pars/North Dome reservoir behaviour reports
• Any NFE Phase 1 delay would materially shift medium-term global supply projections

Recovery timeline: what to watch

The base case of a late-May restart remains the working assumption, but it grows increasingly fragile. Each escalatory development—strikes on Ras Laffan, South Pars impacts, the Fujairah situation—narrows the probability of that timeline holding.

Leading indicators to monitor

1. War risk insurance signals: The first commercial indicator of a Strait/supply reopening will be a shift in insurance posture, not a formal announcement
2. Atlantic Basin diversion data: Track cargo movements for Europe–Asia balance signals
3. Northeast Asian inventory drawdown rates: Watch for signals of when deferred restocking demand returns to spot markets
4. Damage assessment updates: Physical LNG ramp-up from Qatar will take additional weeks after any reopening announcement

Frequently asked questions

How much LNG supply has been disrupted?

Approximately 19 million tonnes of LNG supply may be removed from the global balance through end-May. This figure assumes a late-May restart and could increase if damage assessments reveal more extensive infrastructure impacts.

Why does the US-Iran conflict affect Qatar's LNG exports?

The Strait of Hormuz closure—a consequence of US-Iran tensions—has blocked the primary export route for Qatari LNG. Additionally, strikes on Iran's South Pars field affect a reservoir shared with Qatar's North Dome, introducing long-term production uncertainty.

When will LNG prices return to normal levels?

Spot prices at $20+/MBTU may persist through summer 2025. The timeline depends on Strait reopening, Ras Laffan damage repair, and the intensity of Europe–Asia competition for Atlantic Basin cargoes.

Which countries are most affected by the supply disruption?

Price-sensitive importers—including Bangladesh, Pakistan, India —face the most acute risk of demand destruction. Europe faces significant restocking challenges, while Northeast Asia benefits from higher inventory buffers.

What is the outlook for Qatar's North Field Expansion?

The NFE Phase 1 remains scheduled for March 2027. However, any confirmed reservoir damage from South Pars strikes could delay this timeline, representing a material shift in medium-term global supply projections.

Outlook

The global LNG market navigates a supply shock with few historical parallels in scale and complexity. The disruption encompasses:

• Physical infrastructure damage at Ras Laffan
• Reservoir uncertainty from South Pars strikes
• Insurance-driven market closure
• Structural tension between European energy security commitments and short-term supply realities

The base case of a late-May restart remains fragile. Market participants should prioritise tracking war risk insurance signals, monitoring Atlantic Basin diversion patterns, and watching inventory drawdown rates across key importing regions.

Market intelligence based on Kpler vessel tracking data and LNG flow analysis. Data referenced accurate as of 19 March.

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