LNG: What is it and its Common Uses Explained

Disruption Hits Global Energy Market as Strait of Hormuz Experiences Severe Shipping Disruptions

A significant impact on global energy supplies has been felt following recent tensions between the United States and Iran. The Strait of Hormuz, a critical shipping route that accounts for 27 percent of the world’s maritime oil trade and 20 percent of liquefied natural gas (LNG) shipments, has seen severe disruptions to its operations.

Shipping through the strait has been significantly reduced, with Saudi Arabia rerouting oil through alternative pipelines. Qatar has also halted LNG production following attacks on its infrastructure. The disruption is expected to have a substantial impact on global energy markets, particularly for countries that rely heavily on gas.

Natural gas accounts for approximately 25 percent of global energy consumption. The recent disruptions to LNG supplies have raised concerns about the potential effects on these regions. LNG is formed by cooling natural gas to extremely low temperatures, making it safe and efficient to transport over long distances.

LNG production involves several stages, including purification, fractionation, and storage. The resulting fuel typically consists of 85-95 percent methane, with small amounts of other hydrocarbons. LNG is stored in insulated tanks and then pumped onto carriers for transportation to terminals worldwide.

At its destination, LNG is regasified using seawater or a warm water bath before being transported through pipelines for consumption. LNG also supports various industries, including power generation, fertilizers, plastics, paints, and medicines. The disruption has already forced fertilizer producers in the region to suspend operations due to the critical role natural gas plays in their manufacturing process.

The closure of the Omani port of Salalah, which holds an ammonia storage terminal, has further exacerbated the situation. The port was hit by a drone attack on March 11. The global helium market is also expected to be affected, with QatarEnergy’s decision to halt gas production resulting in the removal of approximately 5.2 million cubic meters of helium from the market each month.

Source: Al Jazeera