Qatar's Ras Laffan Shutdown Sends Natural Gas Ripping as Global LNG Supply Takes a 20% Hit

The Strike That Broke the Global Gas Market

On March 2, Iran launched retaliatory drone strikes across the Persian Gulf targeting U.S. allies — part of the wider escalation following U.S.-Israeli military strikes that killed Ayatollah Ali Khamenei. One drone hit an energy facility inside Qatar's Ras Laffan Industrial City, the sprawling complex that houses the bulk of Qatar's LNG processing and export infrastructure.

QatarEnergy — the world's largest LNG producer — halted production and declared force majeure on deliveries to affected buyers. The shutdown removed roughly 20% of global LNG supply from the market in a single weekend. European TTF benchmark prices surged nearly 50%, and the shock propagated through every connected gas market, including Henry Hub.

Why Henry Hub Caught the Bid

U.S. natural gas doesn't trade in a vacuum anymore. With American LNG export capacity at record levels, Henry Hub futures jumped alongside global prices and crude oil as the market priced in a scenario where U.S. cargoes would need to backfill the Qatar shortfall. An open-ended Middle East conflict that has now spread to over a dozen countries has pushed U.S. natural gas prices for summer and even next winter higher, as traders weigh how surging LNG export demand could tighten domestic supply.

The move also landed on a market already structurally tighter than it looked. The EIA's latest storage report showed working gas at 1,886 Bcf as of February 27, with a 132 Bcf net withdrawal for the week. Winter Storm Fern in late January had already erased the storage surplus that had been capping prices for months, and the EIA raised its 2026 Henry Hub price forecast by 23% in response. The January spot average hit $7.72/MMBtu — the highest nominal monthly average since September 2022.

The Counterweight: Warm Weather

Not everything points one direction. The Commodity Weather Group's forecast calls for above-average temperatures across most of the U.S. from March 7–11, which is actively suppressing near-term heating demand and capping the domestic rally. Physical prices were mixed heading into the weekend even as futures held their geopolitical premium.

That tension — geopolitical supply shock pulling prices up versus mild spring weather pulling them down — is what makes the current setup interesting. Henry Hub reclaimed $3/MMBtu but hasn't been able to sustain a move much above it. The NATGAS perp on Hyperliquid, trading at $3.427, is running slightly above the front-month futures print of $3.186, reflecting the leveraged market's lean toward further upside.

What Matters Next

The duration of the Ras Laffan shutdown is the single biggest variable. If QatarEnergy restores production within weeks, the geopolitical premium bleeds out fast. If the conflict widens further or Iranian strikes recur, the 20% supply hole persists and Henry Hub gets repriced structurally higher as U.S. LNG exports absorb incremental global demand.

The other watch item is storage trajectory. The U.S. entered withdrawal season with a comfortable surplus, but the EIA now projects end-of-March inventories well below prior estimates after January's extreme cold depleted the cushion. If exports ramp into a tighter domestic balance, the summer injection season math gets harder — and that forward curve steepening is already visible in the strip.

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