IEA has no plans for gas reserves, urges members to boost gas security: Sadamori
The International Energy Agency does not have any immediate plans to introduce gas emergency reserves by its member countries but it is urging its members to be more resilient in their gas security amid escalating tensions in the Middle East, IEA’s head of energy markets and security said Thursday.
Speaking at a press briefing on the sidelines of the LNG Producer-Consumer Conference in Tokyo, Keisuke Sadamori said that the IEA’s current priority is to implement its policy which focuses on market analysis and ensuring transparency of global LNG markets.
“We have been advocating the need for flexibility in the [LNG] market on the supply and demand side, and flexible pricing systems [that] reflect regional supply and demand balance,” Sadamori said. “We believe it is our duty to implement this direction, which is mandated by IEA ministerial meetings back in 2015.”
Sadamori, however, said the IEA does not rule out future discussions of gas reserves by its member countries in the future.
POSSIBLE LNG IMPACT
Asked whether the IEA sees any risk in gas security from escalating tensions in the Middle East, Sadamori said that the agency does not see any impact on LNG supply from the region as recent oil facility attacks were limited to Saudi Arabia.
But Sadamori added that the “deteriorating Middle East security situation may impact LNG supply in particular if there is any serious conflict in particular a serious trouble involving the Strait of Hormuz that would be a major course of transit of LNG from Qatar and the UAE.”
Global energy security came under the spotlight since tanker attacks in the Gulf of Oman near the Strait of Hormuz in May and June. About 30% of the world’s seaborne oil transits the Strait of Hormuz.
LNG supply from Qatar and UAE account for one quarter of the global LNG trade, Sadamori added.
The IEA is closely monitoring the situation in the Middle East as any event at the Strait of Hormuz could have impact on oil supply of about 20 million b/d, said Sadamori, adding that it’s a “very serious situation for global energy supply security.”
As part of precautionary measures, the IEA is urging its members to enhance their gas security, said Sadamori, adding: “I think it is very important for governments to be prepared and ensure resilience of natural gas supply and demand.”