Global gas supply in turmoil as Qatar halts production after Iranian drone strikes

GLOBAL energy markets were thrown into turmoil after QatarEnergy announced a complete halt to its liquefied natural gas (LNG) production, effectively taking the country’s entire export capacity offline. The unprecedented shutdown follows Iranian drone strikes on key energy installations at Ras Laffan Industrial City and Mesaieed Industrial City, removing nearly a fifth of global LNG supply from circulation and intensifying volatility across international fuel markets.

In a statement published Monday, QatarEnergy confirmed that military attacks had struck its operational facilities in Ras Laffan and Mesaieed, forcing the suspension of LNG output and related products. The company did not indicate when production might resume, leaving importers and traders grappling with uncertainty over the duration of the disruption.

The strikes form part of a wider escalation in the Gulf, triggered by Iranian retaliation linked to ongoing U.S. and Israeli military operations in the region. Energy infrastructure has increasingly become a focal point in the confrontation. In neighboring Saudi Arabia, operations at the Ras Tanura oil refinery were halted, while other oil and gas facilities across the Middle East have scaled back output as a precaution amid security concerns.

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Qatar ranks among the world’s top LNG exporters, with production spread across about 14 liquefaction trains. Before the outbreak of hostilities, the country accounted for roughly 20 percent of global LNG export capacity, making it a cornerstone supplier to Europe and Asia. The abrupt suspension has dramatically tightened supply conditions, raising concerns among analysts that gas prices, which are already elevated due to geopolitical tensions, could surge further in the coming days.

Market reactions

Energy markets reacted swiftly. European benchmark gas prices recorded sharp gains, while Brent crude prices climbed between 8 percent and 13 percent in early Monday trading as investors priced in the risk of prolonged supply disruptions and instability around the Strait of Hormuz, a critical maritime chokepoint for global energy shipments.

Qatar’s defence ministry confirmed that Iranian drones had targeted the Ras Laffan facility, a central hub for LNG production and export operations, as well as a power plant tank in Mesaieed. However, authorities have yet to release a comprehensive assessment of the physical damage sustained at the sites.

For global energy buyers, particularly major importers in Asia and Europe with long-term supply agreements tied to QatarEnergy, the shutdown presents an extraordinary supply shortfall. Governments and utilities may now be forced to tap strategic reserves, seek alternative cargoes in a tightening spot market, or accelerate contingency planning to safeguard energy security.

QatarEnergy said it will continue to provide updates to stakeholders as the situation evolves, but with regional tensions still escalating, the outlook for a swift restoration of output remains uncertain.