Key facts
- Pakistan acquired a spot LNG cargo from TotalEnergies at $17.37 per million British thermal units.
- The delivery window for the cargo is July 10-11.
- This is Pakistan's second spot LNG purchase in two weeks, signaling ongoing supply constraints.
- The price paid is a premium compared to the previous week's purchase and the Asian spot market average.
- Reduced Qatari LNG supply, exacerbated by Middle East conflict, has forced Pakistan to seek alternatives.
Pakistan has secured its second spot liquefied natural gas (LNG) cargo in as many weeks, indicating persistent supply tightness in the global market and a continued reliance on LNG despite elevated prices. The country purchased the cargo from TotalEnergies for $17.37 per million British thermal units, with delivery scheduled between July 10 and 11. This price is higher than the $16.74 per mmBtu paid for a cargo bought from BP the previous week, representing a premium over the average Asian spot market price.
Historically dependent on long-term supply agreements with Qatar, Pakistan has faced an intensifying energy crisis due to disruptions stemming from the Middle East conflict, which impacted Qatari LNG production and exports. The country has struggled to afford alternative supplies due to war-related price premiums. The recent purchases suggest that while supply remains constrained, Pakistan cannot entirely forgo LNG, even at a significant cost for prompt deliveries.
Qatari LNG flows to Pakistan have seen a dramatic decline, falling from nearly 800,000 tons in January to less than 50,000 tons by April. While cargoes from Mozambique and Oman have provided some relief, they have not compensated for the pre-war levels. Pakistan has also resorted to purchasing U.S. LNG, with a cargo delivered in May priced at $18.40 per mmBtu, highlighting the cost challenges associated with securing alternative supplies.