Kathmandu. Iran has carried out a series of attacks on Qatar’s facilities during the escalating conflict in the Middle East. With this, Qatar has taken such a decision. This has disrupted Asian supplies. Countries like Pakistan and Bangladesh, in particular, are facing crises and are without many options.
In fact, Qatar has suspended NLG supply and production since the Iranian attack. Qatar’s move has led to a sharp increase in gas prices in European and Asian markets. Pakistan and Bangladesh are facing an immediate energy crisis. Because they were completely dependent on Qatar’s energy supply.
8% of consumption in Asia
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Together, Qatar and the United Arab Emirates (UAE) supply 99% of Pakistan’s NLG imports, Bangladesh’s 72% and India’s 53%, according to data from analyst firm Kepler. Asia is Qatar’s primary destination for gas. It consumes more than 80% of Qatar’s NLG shipments. This makes it the world’s second-largest NLG producer after the United States.
Limited reserves in Pakistan and Bangladesh
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This disruption poses an immediate challenge for Pakistan and Bangladesh. It has limited supply reserves. Go Katayama, chief insights analyst at Kepler, told CNBC, “Pakistan and Bangladesh have limited storage and procurement flexibility. ’
Bangladesh is already facing structural shortages in its gas system. According to the Institute of Energy Economics and Financial Analysis, the country is facing a gas shortage of more than 1300 million cubic feet per day. In such a situation, Qatar’s move is creating more trouble.
Crisis for Industry
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A senior official at state-owned PetroBangla told Reuters that prolonged power cuts would put pressure on power generation and industrial production as the summer peak approaches. “Of the nine LNG cargoes destined for Bangladesh from Qatar in March, four have already crossed the Strait of Hormuz,” the official said. However, the authorities may try to get more cargo from the spot market. For Bangladesh, prices could rise significantly. This makes them unaffordable.
Pakistan is facing similar challenges. However, industry analysts say increased solar power generation could help reduce daytime electricity demand. Conversely, if NLG supplies are limited, Bangladesh may have to increase its coal consumption and import electricity from India.
India may also be affected
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Disruptions in energy supply from the Gulf countries could also affect India. According to a Reuters report, gas companies reduced supplies to some buyers earlier this week, anticipating a decline in NLG availability from the Middle East. India has faced a temporary suspension of cargo. As a result, supply to a wide range of industrial consumers and city gas distribution companies has fallen by 40 percent. The closure of the Strait of Hormuz has exacerbated the crisis. –Agency
