LNG tankers divert to Asia as Middle East war tightens supply

Thursday 26 March 2026 - 09:20

By: Dakir Madiha

LNG tankers divert to Asia as Middle East war tightens supply

At least 11 liquefied natural gas tankers originally bound for Europe have been redirected to Asia since early March, as buyers in the region outbid European importers for limited cargoes following the escalation of war in the Middle East. Data from MarineTraffic shows the rerouting trend as disruptions around the Strait of Hormuz removed roughly 20 percent of global LNG supply.

The shift comes at a critical time for Europe, which is trying to rebuild depleted gas reserves ahead of winter. Data from S&P Global confirmed that at least eight Atlantic Basin cargoes have changed course away from Europe since late February, with further diversions expected as Asian spot prices maintain a premium over European benchmarks.

Price differences are driving the redirection. On March 23, S&P Global Platts assessed the JKM benchmark for northeast Asia at 20.68 dollars per million BTU, compared with 19.14 dollars for northwest Europe. The gap translates into more than 8 million dollars in additional value for a standard LNG cargo delivered to Asia.

Several vessels illustrate the trend. The tanker La Seine, chartered by TotalEnergies, diverted toward the Cape of Good Hope after loading at the Plaquemines LNG facility in Louisiana operated by Venture Global. Other ships, including BW Brussels carrying Nigerian LNG and US cargoes aboard Clean Mistral and Simsimah, also redirected toward Asian markets in early March.

The loss of cargoes is worsening Europe’s storage situation. Gas reserves across the region fell below 30 percent of capacity by the end of March. Levels dropped to about 21 percent in Germany and just over 10 percent in the Netherlands, marking record lows for this time of year. Benchmark TTF gas prices in Europe briefly rose above 61 euros per megawatt hour earlier in the month before easing amid volatile trading.

The European Commission said there were no immediate supply risks but stressed the need for close monitoring. Analysts remain cautious. S&P Global warned that supply constraints linked to disruptions in Qatar and reduced Russian gas flows could leave Europe facing a storage shortfall before next winter.

Global supply pressures have intensified. Iran-linked drone strikes forced Qatar to suspend production at the Ras Laffan complex, the world’s largest LNG facility, triggering force majeure notices. Consultancy Wood Mackenzie estimates that LNG demand in South Asia could fall by 2 to 3 million tonnes through the third quarter of 2026 as countries seek alternatives.

Pipeline supplies offer limited relief. Norwegian exports are running at full capacity, Algerian flows are near their limits, and US liquefaction plants are operating above nominal levels. With the gas injection season underway and competition between Atlantic and Pacific buyers intensifying, Europe faces mounting pressure to secure enough flexible cargoes to refill storage before winter.