On Sunday, EU ambassadors were already concerned about the effect prolonged closure of the Gulf to gas and oil shipments might have on energy prices and shipments of liquified natural gas, of which the EU receives a portion from Qatar, according to a diplomat briefed on the discussions.
The shutdown of Qatari production was also followed by shutdowns of oil fields in Israel and Iraqi Kurdistan as well as a major Saudi Arabian refinery, accounting for much of the production in the gulf.
In a post on LinkedIn, Ditte Juul Jørgensen, a senior EU energy official, acknowledged “volatility” in global markets tied to the supply disruptions but said there was “no risk to supply” thanks to strenuous EU diversification efforts since Russia’s invasion of Ukraine and the relatively small portion of LNG imported via the Strait.
However, the concerns arise as Europe is already trying to diversify its supply of LNG. Qatar was seen as a viable alternative source of supply amid increasing EU skepticism of the U.S., now the EU’s biggest importer of LNG, and was among a handful of countries granted an exemption to rigorous vetting requirements imposed under an EU-wide ban on Russian gas passed last year.
On Tuesday, the EU’s energy chief Dan Jørgensen will head to Azerbaijan to shore up the EU’s relationship with one of those alternative suppliers. In a note, the Commission said Azerbaijan plays a “significant role” in ensuring a “more diversified, reliable and secure gas supply.”
QatarEnergy accounts for nearly 20 percent of the global LNG trade, and is the fourth largest supplier of LNG to the EU, accounting for 6 percent of the bloc’s total intake. The majority of Qatari LNG goes to Asia.