BNY warns Hormuz disruption could threaten 20-25% of global LNG trade

  • BNY warned that Hormuz disruptions and halted Qatari exports threaten global natural gas supplies.
  • 20-25% of global LNG trade transits the Strait of Hormuz, primarily from Qatar.
  • BNY said a full disruption is not the base case but urged planning for tail risks.

BNY warned that potential disruptions in the Strait of Hormuz and a possible halt in Qatari LNG (liquefied natural gas) exports pose significant risks to global natural gas markets. The strait carries about 20% of global oil and roughly 20-25% of global LNG trade, primarily from Qatar, the world’s largest LNG exporter. BNY said even a temporary closure or increased military activity could trigger sharp price increases, especially in Asia, while Europe could face renewed energy inflation after becoming more reliant on LNG since the Russia-Ukraine conflict. The report said traders face higher volatility and potential margin calls, while consumers could see higher utility bills and costs for goods dependent on natural gas. Although a full disruption is not the base case, BNY urged market participants to account for the risk in positioning for the coming months and highlighted supply-route diversification and resilience as priorities for policymakers and businesses.

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