Among the vessels struck in the Strait of Hormuz was the Bermuda-flagged Gaslog Shanghai, carrying liquefied natural gas from Qatar. Oil dominates coverage of the strait. Gas is the quieter problem, and in some ways the harder one.

What LNG is

Natural gas is normally moved through pipelines. Where a pipeline is impossible — across an ocean, or between countries with no shared infrastructure — the gas is chilled to around minus 162°C, at which point it becomes liquid and shrinks to a tiny fraction of its gaseous volume.

That liquid can be carried in specially insulated ships, then warmed back into gas at an import terminal and fed into the receiving country’s network.

This is what allows gas to be a globally traded commodity rather than a regional one — and it is why Qatar, with enormous reserves and a coastline inside the Gulf, is one of the world’s largest suppliers.

Why gas is harder to replace than oil

Oil is fungible and easy to store. A refinery can take crude from many sources, and countries hold strategic reserves measured in weeks or months of consumption.

Gas is different in three ways that matter.

It is harder to store — storage means pressurised facilities or depleted gas fields, and capacity is limited relative to demand. It requires specialised infrastructure at both ends, so a country can only import LNG if it has built a regasification terminal. And the carriers themselves are a small, expensive fleet that cannot be expanded quickly.

The result is that a disruption to gas supply is less easily absorbed than an equivalent disruption to oil, and it shows up faster in prices.

Where it lands

Gas heats homes, and in many countries it also generates a substantial share of electricity. So a gas price shock arrives in household bills twice — once in heating, once in the electricity price that gas-fired generation helps set.

It also reaches food. Natural gas is the feedstock for most nitrogen fertiliser, so sustained high gas prices raise fertiliser costs, which raise growing costs, which eventually reach the shelf.

Europe learned this sequence in detail after 2022, when it replaced piped Russian gas largely with LNG bought on the world market. That shift made European buyers competitors for the same cargoes that Asian buyers depend on — which is why a vessel hit near Oman can move prices in countries with no connection to the Gulf at all.

The safety question

LNG carriers are among the more heavily engineered merchant ships afloat, with double hulls and insulated containment systems, and the industry’s safety record over decades has been strong.

But the cargo is a cryogenic liquid that becomes flammable gas when it warms. A vessel struck by a weapon is outside the range of scenarios the design is built for, and the crews transiting the strait are carrying that risk on behalf of everyone whose heating it eventually supplies.

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Sources: Arab Times Kuwait; Bloomberg, August 2026.