Qatar Becomes Largest US LNG Buyer as Hormuz Risk Reshapes Trade

QatarEnergy has signed contracts for up to 7 million metric tons per year of US liquefied natural gas, a volume that will make the world's second-largest LNG exporter the single largest buyer of American cargoes once deliveries start in 2030 and 2031.

The state-owned company last week concluded a 20-year agreement for 3 mtpa from Woodside Energy's Louisiana facilities. A week earlier it signed deals with Cheniere Energy for up to 4 mtpa from the Sabine Pass and Corpus Christi plants, running through 2054.

CEO Saad al-Kaabi told Reuters he expects additional supply agreements with US and other producers this year — potentially locking in millions of tons of overseas LNG for decades. That promise deserves scrutiny: none of these counterparties has disclosed pricing, and the cargoes will not flow for at least five years.

Why is the Gulf's cheapest producer buying US gas?

Qatari production costs run at roughly $3-$5 per million British thermal units, about half the cost of many US projects. On pure economics, these purchases make little sense.

On geography, they make considerable sense. Qatar has no viable LNG export route other than the Strait of Hormuz, through which roughly a fifth of global energy supplies flowed before the war. Its entire export industry sits at one site: the giant Ras Laffan complex processing North Field gas.

That concentration proved costly in March, when an Iranian missile damaged two of QatarEnergy's 14 LNG trains — removing about 17% of national export capability. The company put lost revenue at roughly $20 billion a year and repairs at around three years. For context, that annual loss approaches the entire cost of several mid-size liquefaction projects.

Can Qatar build its way out of the risk?

Not convincingly, on the evidence available. Alternative export infrastructure would require tens of billions of dollars in pipelines and liquefaction capacity — and, as the war demonstrated, every new facility is another target. Neighbors face an easier equation: Saudi Arabia and the UAE are expanding or preparing pipeline networks that bypass Hormuz for crude and refined fuels. Qatar has no equivalent option for LNG.

Before the US-Iran war began on February 28, QatarEnergy had already been acquiring stakes in LNG projects from North America to Africa to broaden its trading portfolio. The latest deals mark a shift in kind, not degree: the company now appears to be buying insurance against disruption to its own exports rather than simply diversifying.

What does this mean for LNG supply and rates?

The supply backdrop is tightening toward oversupply. The International Energy Agency estimates roughly 300 billion cubic meters of new LNG export capacity will come online worldwide between 2025 and 2030 — increasing available global supply by around 50%. More than half comes from the US; Qatar accounts for roughly another quarter. The two countries will dominate global LNG growth for the coming decade, setting up an intensified market-share contest.

Washington holds one decisive advantage in that race: American exporters face none of the geopolitical constraints of Hormuz dependence. Since the Iran war, buyers increasingly weigh security of supply as heavily as price — a repricing of risk that favors US cargo regardless of Qatari cost leadership.

Bob McNally, founder of Rapidan Energy Group and former White House energy advisor to President George W. Bush, captured the reversal: "Twenty-five years ago my White House colleagues and I worried the US would become as dependent on Qatar for LNG as we were on OPEC for oil. Then came the shale revolution and Iran War, and now Qatar is buying from us."

QatarEnergy still plans to nearly double LNG production by 2030, with the first new trains expected online early next year. The open question is no longer schedule but survivability — whether those facilities remain operational in a radically reshaped Gulf.

Even a durable US-Iran peace deal, itself a large assumption, would not restore the old geometry: Hormuz's role in regional energy markets has likely changed permanently, to Qatar's disadvantage. Expect further long-dated US supply contracts this year as Gulf producers and their customers keep paying for geographic security they can no longer assume.