September 16, 2026: Depressed LNG demand in recent months in China and India is the result of spiking LNG prices due to the Middle East conflict, and consumption in the key Asian gas import markets is set to rebound once the war ends and prices normalize, industry executives say. 

The war in Iran and the closure of the Strait of Hormuz have choked LNG supply out of Qatar and the United Arab Emirates (UAE)

Persian Gulf producers have managed to find workarounds for oil deliveries, including shuttle-shipping crude out of the Strait and then transferring the cargo onto other vessels offshore Oman.

But LNG flows have remained non-existent or very low, due to the physical and chemical difficulties in ship-to-ship (STS) transfers of the liquefied natural gas. Some LNG shipments are estimated to have moved out of the chokepoint in recent weeks, as carriers loaded from Qatar and the United Arab Emirates in the Persian Gulf have transferred their cargoes onto other vessels outside the Strait of Hormuz.

These rare cargoes haven't offset the massive supply loss since March, sending Asian spot LNG prices last week to the highest level since 2022. The re-escalation in the Middle East has further delayed any recovery of LNG flows out of the Strait of Hormuz. 

These rare cargoes haven't offset the massive supply loss since March, sending Asian spot LNG prices last week to the highest level since 2022. The re-escalation in the Middle East has further delayed any recovery of LNG flows out of the Strait of Hormuz. 

"The prices have hit through the roof ... and that is definitely impacting the demand insofar as India is concerned because there are a lot of sectors which are price sensitive," Deepak Gupta, chairman of India's top gas distributor, GAIL, said at the Gastech conference in Bangkok, as carried by Reuters.

PetroChina, the biggest importer in the world's top LNG-buying country, says the current lower purchases are a direct result of soaring prices.

"I think it is due to the temporary suppression of the demand faced by high price," Luo Yizhou, CEO of PetroChina International (PCI), the trading arm of the Chinese state giant, said at the same conference.

(Source: Oil Price)