Key facts
- Oman's Energy Minister Salim Al-Aufi called for diversifying LNG export routes to bypass the Strait of Hormuz.
- He suggested alternative routes could include going north, through Oman, or through Yemen.
- Such routes would require new pipelines and could become targets for drone and missile strikes.
- Oman LNG produces over 11 million tons annually and has been running at over maximum capacity.
- Chevron's Australian operations president expects elevated LNG prices for at least six more months.
- QatarEnergy is reportedly seeking long-term LNG deals with U.S. producers.
Oman's Minister of Energy and Minerals, Salim Al-Aufi, stated at the Gastech conference that the Middle East needs to develop alternative liquefied natural gas (LNG) export routes to bypass the Strait of Hormuz, which has become a point of concern due to ongoing geopolitical tensions. Al-Aufi suggested that options could include routes going north, through Oman, or through Yemen, emphasizing the need for diversification to ensure resources can be exported from the region.
These alternative routes would likely require the construction of new pipelines, a process that is time-consuming and could present new targets for drone and missile strikes, as evidenced by recent Yemeni strikes on Saudi Arabia's East-West pipeline. Oman itself is a significant LNG producer, with an annual output exceeding 11 million tons. This year, its LNG hub has operated above its maximum capacity of 11.4 million tons per year to compensate for lost supply from Qatar, the region's largest producer.
Meanwhile, Balaji Krishnamurthy, president of Chevron's Australian operations, predicted that LNG prices will remain elevated for at least another six months, citing difficulties in seeing prices decrease. Reports also indicate that QatarEnergy is in discussions with U.S. producers for long-term LNG deals extending to 2031, suggesting that repairs to its domestic supply infrastructure may take considerable time, potentially prolonging the period of high LNG prices.