US-Israeli War on Iran Causes Major Oil, Gas Disruptions

The U.S. and Israel war against Iran has caused oil and gas exports to be disrupted from the Middle East, and production from Qatar?to Iraq was forced to stop.

Here are the major energy disruptions that have occurred so far.

Iraq, OPEC’s?second largest producer, has reduced?output by almost a third due to storage limitations and the absence of export routes, officials said. The country could be forced to close 3 million barrels per day, or nearly all its production, within days, if exports don't resume. QatarEnergy LNG halted operations: Qatar ceased operations at its LNG plants on Monday. This affected some of the largest LNG plants in the world and a source which supplies around 20% of global LNG. QatarEnergy suspended some of its downstream output on Tuesday. Saudi Arabia's disruptions: Saudi Arabia is the world's largest oil exporter and has suspended production at its 550,000-bpd Ras Tanura refinery. It also began rerouting crude from eastern ports to Yanbu on the Red Sea. Israel and Iraq's Kurdistan region have also cut back on their oil and natural gas production. A fire was caused by debris in the UAE's Fujairah Port, which is a major global hub for oil storage and bunkering.

Shipping through the Strait of Hormuz was shut for a 4th day following an attack by Iran on five ships. This blocked a vital artery that accounts for 20% of the global oil and gas supply. Iran declares Strait closed. A senior Iranian 'Revolutionary Guards' official declared on March 2, that the Strait of Hormuz was closed and warned any ship trying to pass it would be fired upon. War risk insurance is cancelled. Major marine insurers have cancelled war-risk coverage on vessels operating in Iranian waters, Gulf waters and adjacent water.

Impact on consumers: China is cutting'refinery runs'. Chinese refiners have shut down crude units, or are advancing maintenance plans due to disruptions in crude flow. India looks for alternatives: "India is seeking alternative sources of 'crude, LPG, and LNG, if the crisis extends beyond 15-20 days," a government official stated. Indonesia shifts its sourcing: Indonesia intends to increase U.S. oil imports in order to compensate for the reduced Middle East supply.

(source: Reuters)