ADNOC Continues UAE LNG Exports Despite Strait of Hormuz Risks
Key Takeaways
- •An ADNOC LNG tanker reportedly transited the Strait of Hormuz while its location devices were switched off to avoid detection.
- •Bloomberg said ADNOC was also loading another LNG carrier at its Das Island facility at the end of last week.
- •The report follows an earlier attack on a Qatari LNG carrier, which has made some shippers less willing to use higher-risk routes.
- •ADNOC Logistics and Services recently ordered four new LNG carriers for $900 million.
- •ADNOC has eight additional LNG carriers under construction in South Korea, with delivery scheduled from 2028 and 20-year charters to ADNOC Gas.
The UAE is continuing to export liquefied natural gas despite the threat of strikes in the Strait of Hormuz.
According to a Bloomberg report, an ADNOC LNG tanker appeared in the Persian Gulf earlier today and successfully exited the Strait of Hormuz, reportedly with its location devices turned off to avoid detection. Bloomberg noted that Iranian forces attacked a Qatari LNG carrier earlier this month, reducing the willingness of energy shippers to take on higher-risk routes. The publication also said ADNOC was loading another LNG carrier at its Das Island facility at the end of last week.
The shipments underscore both the fragile security environment facing Gulf oil and gas exporters and the continued demand for their energy commodities. For Gulf producers, the Strait of Hormuz remains a critical passage because it links export terminals in the region to international markets, so even routine movements can attract closer scrutiny when tensions rise. ADNOC has been particularly active in liquefied gas, stepping in to raise exports after neighboring Qatar declared force majeure at its Ras Laffan LNG hub.
Earlier this month, ADNOC Logistics and Services placed a $900 million order for four newbuild LNG carriers as Abu Dhabi’s national oil company seeks to capture rising global LNG demand.
The Abu Dhabi company also has eight LNG carriers under construction at Samsung Heavy Industries and Hanwha Ocean, with a total investment of $2.5 billion. Those vessels are scheduled for delivery from 2028 and are all contracted on 20-year time charters to ADNOC Gas.
At the same time, LNG importers have been pressing Qatar and the UAE to accept lower prices for their cargoes. Buyers argue that the Persian Gulf is far riskier than it was before the U.S. and Israel attacked Iran at the end of February, and that this increased risk will be reflected in higher insurance costs for shippers. On that basis, they say producers should lower their prices.
By Irina Slav for Oilprice.com
