LONDON (Reuters) - Qatar’s row with powerful Gulf states rippled through Britain’s gas market on Thursday, lifting prices as two shipments from the world’s biggest LNG producer changed course from their likely UK destination, traders and analysts said.
Diversions in the Gulf of Aden left Britain facing a lack of LNG deliveries for the remainder of June, triggering buying by traders at the country’s National Balancing Point (NBP) trading hub - Europe’s biggest gas market - to offset shortages.
The July gas contract TRGBNBPMN7 shot higher on the news, up 4.21 percent to 37.60 pence per therm. UK gas for next-day delivery TRGBNBPD1 also traded higher at 38.50 pence per therm, up 4.62 percent on the day.
The Al Mafyar vessel, carrying about 262,000 cubic metres of LNG from Qatar, is no longer heading towards the Suez Canal, shipping data shows. Its new destination is unknown.
The Zarga tanker, with a capacity of 262,000 cubic metres, executed a U-turn and appears to be heading back in the direction from which it came, shipping data shows.
Shipping intelligence firm Kpler said both tankers were expected by the market to unload at Britain’s South Hook import terminal, part-owned by Qatar Petroleum.
One trader confirmed that assessment, but analysts speculated that only one of the vessels was due for South Hook, with the other due to call at an alternate UK terminal or elsewhere in northwest Europe.
The tankers were not yet officially listed as headed for Britain.
Analysts and LNG traders were at a loss to explain the diversions - the biggest evidence so far of how the diplomatic row in the Gulf might be disrupting LNG trade routes.
Separately Royal Dutch Shell (RDSa.L) has sent a replacement LNG cargo from the United States to Dubai, shipping data shows.
Shell has a deal to supply the Dubai Supply Authority (DUSUP) with LNG which it typically sources from Qatar because of its proximity.
But bans on Qatari vessels entering ports in the United Arab Emirates, imposed after top Arab powers severed diplomatic and transport links with Qatar on Monday, meant it had to source the LNG from elsewhere.
The Maran Gas Amphipolis tanker, carrying around 163,500 cubic metres of LNG produced in the United States, was initially headed toward Kuwait’s port of Mina Al-Ahmadi but made a U-turn on Wednesday to head for Dubai’s port of Jebel Ali.
The tanker is currently unloading at DUSUP’s floating import terminal at Jebel Ali, data showed.
As exclusion zones took effect, Qatar’s fleet of LNG vessels anchored off the UAE’s port in Fujairah prior to the diplomatic cut-off have moved out. They are currently clustered offshore Qatar’s LNG export facility at Ras Laffan.
Since Monday the number of LNG tankers there has risen to 17 from seven, shipping data shows.
The queue reflects the impact of port exclusions as production from the export plant shows no signs of slowdown, an analyst said.
Aditional reporting by Susanna Twidale; Editing by Jason Neely, Greg Mahlich