Thailand Scrambles for LNG Cargoes as Hormuz Disruption Drives JKM to $26.75
Asian spot LNG has climbed 32% above mid-July levels as Strait of Hormuz disruptions cut Middle East supply, leaving Southeast Asian importers with few cheap alternatives.
Asian spot LNG was priced at $26.75 per million British thermal units on Friday (2026-09-18), according to live market data — 32% above the $20.2 that traders reported to Bloomberg on Thursday (2026-07-16), when a fresh escalation in the Middle East drove a 10% weekly jump to the highest level since March.7
Thailand is caught in the middle of that repricing. The country ceased LNG imports in 2021 in response to high spot prices and currency depreciation, leaving it with limited hedging capacity when spot costs spiked again, according to Energy Tracker Asia. Malaysia, the world's fifth-biggest LNG exporter as of 2024, supplies some volumes to Thailand, but pipeline gas and regional supplies cannot substitute for Middle East cargoes now largely blocked by the Hormuz closure.4
The strategic geography explains the price transmission. EIA data show that more than 80% of crude oil and LNG passing through the Strait of Hormuz in 2024 was destined for Asia; a sustained disruption forces buyers across Southeast and East Asia to bid for Atlantic basin and Australian cargoes at significantly higher freight costs.6
Wood Mackenzie has put numbers on the damage. The firm cut its Asian LNG import forecast to roughly five million metric tons from 12.4 million tons, assuming a two-month disruption to Middle East supply. Analyst Lucas Schmitt said the conflict "will significantly reduce Asian LNG demand growth in 2026."2
Demand destruction is absorbing some of the shock. Seb Kennedy, independent energy analyst at Energy Flux, noted that demand pullback in Asian countries has prevented prices from moving further. But substitution has a cost: Asian utilities have increasingly turned to coal-fired generation as LNG prices rose, industry officials said. Bangladesh has raised coal imports and boosted coal-fired output this month, government data show.1,2
The United States is moving to fill part of the supply gap. Deputy Secretary of State Christopher Landau outlined plans at the ASEAN Future Forum to expand US LNG and LPG exports to Southeast Asia, with Washington tapping strategic energy reserves and positioning American supply as a replacement for disrupted Middle East flows.5
ASEAN's longer-term gas plans were already ambitious before the Hormuz closure complicated their execution. Regional energy transition roadmaps envisioned gas capacity reaching nearly 200 gigawatts by 2030, almost double the current 106 GW, according to energy monitor data. Global Energy Monitor estimates that roughly $107 billion in planned regional infrastructure investment is now at risk.3,2
Thailand is trying to build a longer exit. The government accelerated plans for renewable energy deployment and signalled openness to nuclear power to reduce structural LNG dependence, Oilprice.com reported in late August (2026-08-27). Those timelines are measured in years.8
JKM at $26.75/MMBtu is already trading well above the price range that historically triggers coal substitution across Southeast Asia. If Thailand moves aggressively into the spot market for emergency cargoes, buyers who have so far held back face a sharper choice: pay up or burn more coal.7,2