Giovanni Simonetti
Junior Data Analyst, Flux
Brent Rallies to $83.97/bbl
India reduces natural gas supplies, supertanker freight rates reach record high, EU could revive debate about banning Russian gas.
The May’26 Brent Futures contract gapped up by $0.88/bbl to $78.91/bbl and continued rallying all morning to $83.97/bbl at 11:00 GMT (time of writing).
In the news, Indian companies have reduced natural gas supplies to industrial users by 10% to 30% after Qatar halted LNG production amid escalating Iran-related attacks in the Gulf, raising fears of tighter Middle East supply. India, the world’s fourth-largest LNG importer, depends heavily on the region. Petronet LNG Ltd notified GAIL (India) Ltd and others of lower deliveries, prompting GAIL and Indian Oil Corporation to inform customers. To offset shortages, firms plan to seek spot cargoes despite soaring LNG prices, freight and insurance costs following shipping disruptions through the Strait of Hormuz. In other news, supertanker freight rates in the Middle East have surged to record highs as Iran intensifies attacks around the Strait of Hormuz, disrupting a route that carries about one-fifth of global oil and major LNG volumes. The benchmark VLCC TD3 rate for shipments to China jumped to a record W419, or over $423,000 per day, more than doubling since Friday. LNG shipping rates rose over 40% after Qatar halted production, with further increases expected amid tight vessel supply. Norway’s energy minister said escalating US-Israeli strikes on Iran and Tehran’s retaliation could revive European Union debate over banning Russian natural gas imports. European gas prices have surged 75% this week to multi-year high. Although the EU has approved a phaseout of Russian gas by 2027, recent instability may accelerate discussions. Norway, Europe’s largest gas supplier providing about 30% of demand, could play a bigger role if flows tighten further. Finally, at the time of writing, the front-month May/Jun’26 and 6-month May/Nov’26 spreads are at $2.77/bbl and $10.62/bbl respectively.
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