Spot cargoes push Pakistan's winter LNG bill to $1.29bn

Keeping gas stoves burning this winter will cost Pakistan more than $1 billion in liquefied natural gas (LNG) imports, as the government turns to the expensive spot market to make up for supplies from Qatar disrupted by the Middle East war.

The government plans to import 10 LNG cargoes from the spot market for delivery between November 2026 and February 2027, at about double the price it pays Qatar, The Express Tribune reported. Another 12 cargoes will come under long-term contracts.

The winter bill

The issue was taken up at a meeting of the energy task force this month, according to sources. For planning purposes, the projected supply is:

• Qatar: 11 cargoes under long-term contracts, worth $351.41 million
• Eni: one cargo in January, worth $78.42 million
• Spot market: 10 cargoes, costing $863 million
• Total: 22 cargoes, about $1,292.83 million over four months

Each spot cargo is estimated to cost $86.3 million, based on the latest spot price quoted in a tender of $26.30 per million British thermal units.

Demand peaks in January 2027, when eight cargoes are expected to push the monthly bill to $437.32 million, followed by December 2026 at $369 million. The estimates depend on actual supply, contract quantities and prices, and the spot rate at the time of purchase.

The Qatar contracts

Pakistan State Oil (PSO) has two government-to-government deals with QatarEnergy: a 15-year agreement covering 2016 to 2031, and a 10-year contract from 2021 to 2031. Together they bring PSO 6.75 million tonnes of LNG, or 108 cargoes, a year.

The second contract, signed under the PTI government, proved controversial because the country did not need more LNG at the time, which led to a glut. For 2026, PSO and QatarEnergy had earlier agreed to divert 24 cargoes elsewhere because demand in Pakistan was low.

PSO and Qatar have recently served contract review notices, and PSO is seeking the federal government’s consent to review the agreement with QatarEnergy, The Express Tribune reported.

A war-hit supply chain

LNG supply from Qatar has been severely disrupted by the Middle East war, the newspaper said. Brent crude rose to $106.79 a barrel on Monday, its highest since September 29, as attacks on Saudi Arabia overshadowed hopes of more supply, Dawn reported.

The shortage is already being felt at home. Earlier this month, the Lahore Electric Supply Company said it was carrying out about two hours of evening and night loadshedding because power plants that run on imported RLNG had been idle after LNG cargoes were delayed.

Why it matters

Every spot cargo costs roughly twice as much as a Qatari one, and that bill will land on a country already struggling with high energy prices and an IMF programme. Keeping homes warm this winter without adding to the import bill will be one of the government’s hardest tasks. Read our reports on Qatar’s force majeure on November LNG supplies and on OGDCL’s plan to raise oil output.

This article draws on reporting by The Express Tribune and Dawn.