Pakistan Faces LNG Shortage Amid Middle East Tensions

Pakistan is facing a potential liquefied natural gas (LNG) shortage within the next ten days due to escalating tensions in the Middle East. The conflict has disrupted Qatar's LNG exports, leading to soaring fuel prices in Pakistan. In response to the economic strain, the government has canceled its Republic Day parade and raised petrol and diesel prices significantly. Analysts warn that the ongoing geopolitical tensions could lead to a severe supply crunch in global energy markets, particularly affecting South Asia. As the situation develops, the reliance on imports through the Strait of Hormuz adds to the vulnerability of Pakistan and its neighbors.

By Narendra Chaudhary Mar 23, 2026, 23:47 IST

Pakistan's Looming Energy Crisis

As tensions escalate in the Middle East, reports indicate that Pakistan may exhaust its liquefied natural gas (LNG) reserves within the next ten days. This situation arises from disruptions in Qatar's export capabilities, which have led to a broader global energy crisis, as highlighted by a recent Financial Times report. The ongoing conflict, which ignited on February 28, has severely impacted energy infrastructure and shipping routes throughout the region.

In a significant move reflecting the mounting economic strain, Pakistan has decided to cancel its Republic Day parade. A statement from Prime Minister Shehbaz Sharif's office noted that the day will be observed with a simple flag-hoisting ceremony, emphasizing the nation's commitment to the ideals of Pakistan Day while adhering to a broader austerity framework.

Additionally, fuel prices in Pakistan have surged dramatically due to the ongoing conflict in the Middle East. On Friday, the government raised petrol and diesel prices by Rs 55 per litre, bringing petrol to Rs 321 per litre and high-speed diesel to Rs 336 per litre, as reported by the Express Tribune. Officials warned that this could be the first of multiple price increases if the situation in West Asia persists.

The Strait of Hormuz, a crucial chokepoint for global oil supply, has seen Iran impose restrictions on certain tankers amid the escalating conflict. Iran's blockade has halted LNG shipments, and retaliatory strikes following an Israeli attack on Iran’s South Pars gas field have further destabilized supply chains.

Qatar Halts LNG Exports

Pakistan's energy supply is heavily reliant on Qatar, which contributes approximately 20% of global LNG production. Following missile strikes that damaged its Ras Laffan Industrial City, Qatar has suspended exports. State-owned QatarEnergy reported that these attacks have diminished export capacity by around 17%, with repairs expected to take years, leading to force majeure on some long-term contracts.

While several LNG cargoes that left Qatar and the UAE prior to the conflict are still en route, analysts warn that these may be among the last shipments before a significant supply crunch hits global markets.

Rising geopolitical tensions are disrupting global energy markets, driving up oil and gas prices, and jeopardizing LNG supplies to South Asia, according to the Institute for Energy Economics and Financial Analysis (IEEFA). The report highlights that Pakistan, India, and Bangladesh are particularly vulnerable due to their dependence on imports that pass through the Strait of Hormuz.

Notably, former US President Donald Trump has called on nations reliant on oil shipments through the strait to take responsibility for maintaining its accessibility, with support from the US. Washington has been working to alleviate high oil prices amid the ongoing US-Israeli military actions against Iran, which have prompted Iranian retaliations against US interests in the region.