Tensions in the Middle East have reached a boiling point, with Qatar’s Energy Minister Saad Al-Kaabi sounding the alarm on an impending energy crisis. In exclusive comments to the Financial Times, he disclosed that prolonged conflict could force Gulf exporters to invoke force majeure, suspending oil and gas deliveries and sending global prices into the stratosphere.
This contractual safeguard shields firms from liability during wars or calamities. Al-Kaabi cautioned that non-compliant companies invite legal disasters. All regional players might follow suit imminently.
Projections are chilling: Strait disruptions could propel oil to $150/barrel in 2-3 weeks; gas to $40/MMBtu, a 4x jump. Brent crude has surged 20% weekly, trading over $89 Friday (up 3%+), WTI up 25% to $86 (up 5%+), marking highs unseen since April 2024.
As LNG powerhouse number two, Qatar activated force majeure after drones hit Ras Laffan, its premier plant. Even post-ceasefire, full operations may lag weeks to months due to logistics havoc—only 6-7 of 128 carriers ready.
Attacks on 10+ ships have jacked up insurance, stalling shipments. Iranian assaults, targeting Bahrain’s refinery among others, ignite price fires. DBS Bank’s analysis highlights Hormuz mine perils, set to amplify costs across the board.
The interconnected web of global trade now trembles. This warning underscores the fragility of energy lifelines, urging swift diplomatic intervention before supply chains snap.