Bangladesh is confronting significantly higher prices for liquefied natural gas (LNG) from the spot market. This follows Qatar's suspension of deliveries, a move reportedly linked to the escalating Iran-Israel conflict. The disruption has forced authorities to ration gas and idle several fertilizer plants.
State-run Petrobangla has secured two spot LNG cargoes for March. One shipment from Gunvor is priced at $28.28 per million British thermal units (mmBtu) and expected mid-March. Another from Vitol, costing $23.08 per mmBtu, is due later in March. These prices represent a stark increase from earlier purchases this year, which were around $10 per mmBtu.
Officials stated that QatarEnergy halted long-term contract shipments, invoking force majeure due to disruptions connected to the Iran-Israel conflict. This compelled Bangladesh to seek supplies from the spot market despite the elevated costs.
The supply shortage has prompted the government to implement gas rationing, including the shutdown of four fertilizer factories to prioritize power generation and other essential sectors. Persistent disruptions could force Bangladesh to rely more heavily on the volatile spot LNG market, further burdening its energy import expenditures.