Poland's Orlen Cancels Multi-Billion-Euro LNG Contract with Qatar
Poland's energy company Orlen has canceled a multi-billion-euro LNG contract with QatarEnergy, invoking force majeure due to supply disruptions and security risks in the Strait of Hormuz.
Polish energy giant Orlen is canceling a massive multi-billion-euro liquefied natural gas (LNG) contract with QatarEnergy, invoking a force majeure clause following severe supply disruptions caused by the closure of the Strait of Hormuz. The canceled deal alone accounts for 570 million euros for 2026, totaling billions of euros through its scheduled expiration in 2034. However, a separate agreement between the two companies will remain in force.
The closure of the Strait of Hormuz by Iran has severely impacted global energy markets, particularly through severe oil shortages and price spikes. While oil shipments have largely recovered, Qatar's LNG production and export recovery has lagged significantly, currently running at about half pre-war levels. LNG carriers face heightened security risks, and Iranian strikes on Qatari liquefaction facilities have further degraded production capacity.
Diversifying Supply Sources
Before the conflict, Qatar accounted for roughly 20% of the global LNG supply. Due to plummeting supply reliability, Orlen is turning to alternative suppliers such as Norway and the United States to make up the deficit, assuring customers that regular supplies will not be disrupted. Under the force majeure terms, the contract will remain active for another three months before formal termination.
QatarEnergy has not yet commented on the cancellation. While other European and Asian buyers continue to maintain their contracts with the Qatari state-owned supplier despite the bottlenecks, Orlen's move marks a significant scaling back of exposure to secure more reliable energy sources.
