KEY POINTS
- QatarEnergy has halted LNG production after drone attacks on its facilities, causing gas prices in Europe and Asia to surge sharply.
- Saudi Arabia temporarily shut parts of the Ras Tanura refinery after a drone-related fire, though officials say supplies remain stable.
- Tensions around the Strait of Hormuz have pushed oil prices higher, raising fears of broader economic impact if the conflict escalates.
Global energy markets were thrown into fresh turmoil on Monday after QatarEnergy announced it had stopped producing liquefied natural gas (LNG) following drone attacks linked to Iran.
The shutdown sent gas prices sharply higher across Europe and Asia, while oil prices also surged as fears of a wider regional conflict deepened.
The development came just hours after Saudi Arabia confirmed that parts of its major oil processing facility at Ras Tanura refinery were temporarily shut after a drone-related fire.
QatarEnergy Halts LNG Production
In a statement released on Monday, QatarEnergy said it had suspended LNG production and related products due to military attacks on its facilities in Ras Laffan Industrial City and Mesaieed Industrial City.
Qatar’s Defence Ministry said two drones launched from Iran targeted key energy infrastructure. One reportedly struck a water tank at a power plant in Mesaieed, while the other targeted an energy facility in Ras Laffan.
Authorities confirmed that there were no human casualties. However, the full extent of the damage is still being assessed.
The halt is significant because Qatar is the world’s largest exporter of liquefied natural gas. Any disruption in its supply immediately affects global markets.The market reaction was swift.
Benchmark gas prices in the Netherlands and the United Kingdom jumped by nearly 50 percent shortly after the announcement. Europe’s key gas pricing benchmark, the Dutch TTF contract, rose sharply during morning trading.
In Asia, the widely followed Japan Korea Marker (JKM), a key LNG benchmark, surged by almost 39 percent.
Traders reacted strongly because a large share of Europe and Asia’s gas supply depends on shipments from Qatar. With production halted, buyers are bracing for tighter supplies and possible shortages.
At the same time, Saudi Arabia confirmed that two drones attempted to attack the Ras Tanura refinery, one of the largest oil processing facilities in the world.
Although the drones were intercepted, a small fire broke out, causing limited damage. Officials said there were no casualties and described the shutdown of some refinery units as a precautionary step.
