West-to-east transits through the Strait of Hormuz have largely stalled following strikes on commodity carriers over the past week, as hostilities resumed between the United States and Iran, according to Rystad Energy’s latest Gas & LNG market update.
The strike on the 216,000 cubic metre (cbm) Al Rekayyat Q-Flex liquefied natural gas (LNG) carrier, first reported last week, has stalled future transits by Qatar, with zero transits recorded since the incident.
Lu Ming Pang, Vice President of Gas & LNG Research at Rystad Energy, who is based in Singapore, said the situation had deteriorated sharply.
“Following the escalation in hostilities between the US and Iran, transits through the Strait of Hormuz will come under even greater scrutiny,” said Pang.
Pang noted that Qatar and the UAE had previously kept LNG vessels moving through the Strait by disabling their AIS transponders to quietly maintain export volumes.
However, the attack on Qatar’s Al Rekayyat Q-Flex carrier on 7 July, which occurred despite its AIS being switched off, along with the subsequent strikes on two UAE-linked VLCCs on 14 July, shows that even vessels attempting to move discreetly are no longer safe from attack.
“Based on our satellite tracking, only one UAE LNG vessel has completed the transit since the Al Rekayyat incident, while Qatar has not dispatched another vessel,” said Pang.
“Markets had initially expected flows to normalise following the US-Iran memorandum of understanding signed on 17 June, with a noticeable build-up of ballast LNG carriers entering the Persian Gulf in anticipation of stronger exports.
“However, those expectations have failed to materialise, and the latest escalation has further reduced the likelihood of a near-term recovery.”
“As confidence in the security of the Strait continues to erode, markets will increasingly need to price in the prospect of more prolonged supply disruptions, a shift that has already contributed to firmer global gas prices over the past week.”
East Asia spot LNG prices for September delivery rose to US$18.60 per million British thermal units (MMBtu) as of 14 July, up from US$16.38 per MMBtu the previous week.
Title Transfer Facility (TTF) prices in Europe also increased, reaching US$17.94 per MMBtu over the same period, up from US$16.38 per MMBtu a week earlier.
The main driver behind the increases across both regions has been fading optimism over a normalisation of flows through the Strait of Hormuz.
Summer demand fundamentals across Asia remain unchanged from the prior week, with forecasts continuing to point to warmer-than-normal temperatures across major LNG demand centres.
The Japan Meteorological Agency is projecting at least a 40 per cent probability of above-normal temperatures through the first week of August, rising to as high as 70 per cent across most provinces between 11 and 17 August.
The Korean Meteorological Administration is forecasting a minimum 50 per cent probability of above-normal temperatures through the end of July, increasing to 60 per cent during the first two weeks of August.
Europe’s heatwave is expected to persist, with warmer-than-normal conditions now forecast to extend through the end of August.
Norwegian pipeline gas flows dipped briefly to 307 million cubic metres per day (MMcmd) on 9 July because of unplanned maintenance at the Oseberg and Ormen Lange fields, before recovering to 322 MMcmd by 14 July.
Russian pipeline flows have held steady at roughly 49.65 MMcmd.
Underground gas storage stood at 59.22 billion cubic metres (Bcm), or 51.9 per cent full, as of 13 July, up from 57.17 Bcm (50.1 per cent full) a week earlier.
Storage remains about 12.2 per cent below the same period in 2025, a gap that has widened from roughly 10 per cent the previous week.
Henry Hub prices fell to US$2.88 per MMBtu as of 14 July, down from US$3.22 per MMBtu a week earlier.
US gas storage rose to 2,983 billion cubic feet (Bcf) as of 3 July, an increase of 61 Bcf, and is now roughly in line with year-ago levels while running well above the five-year average of 2,798 Bcf.
US feedgas to liquefaction facilities eased to 17.45 Bcfd as of 12 July, down from 18.18 Bcfd a week prior, largely reflecting the start of planned maintenance at Freeport LNG on 10 July, a process expected to run through the end of August.
The decline in Henry Hub prices has primarily been driven by revised weather forecasts pointing to fewer cooling degree days from the third week of July onward, though the outlook remains above normal for the rest of the month.
