Global LNG Exports Fall to Two-Year Low

0:00 That's a very good question.

0:01 I think in a few weeks ago, they tried to pass through the Strait of Hormuz,

0:08 negotiating directly potentially with Iran at the time

0:11 when Iran wanted to start this new system,

0:14 this new equation of a tolling boost system.

0:17 And so some countries were ready to play the game.

0:21 And what the U.S.

0:22 blockade did was to delegitimize and negate the this new equation.

0:27 I think right now Qatar might try to have this safe passage.

0:34 I think some countries will wait to see that it's really secure,

0:40 especially for tankers, commodity tankers that are more expensive.

0:43 I think they will still wait a little bit.

0:45 Help us with Arabian list risk, I should say.

0:48 Who is on Qatar's side?

0:50 Is it Saudi Arabia is linked to Doha versus the UAE?

0:55 Explain that politics.

0:56 So I think Qatar has been the closest Gulf countries to Iran,

1:00 and that has been very different than Saudi Arabia or the UAE,

1:04 because Qatar and Iran are sharing a big the world's largest gas field.

1:10 And Qatar has always depended on the Iran also for the Strait of Hormuz.

1:14 And that's always taken a more

1:16 a perspective of appeasement and negotiation with Iran.

1:21 So, Leslie, how does the world open up the Strait of Hormuz?

1:25 It's not the secretary of defense saying it's open because we

1:29 all see the same maps and the ships are just sitting there.

1:33 How do you actually open it up?

1:35 How does that happen, do you think?

1:37 So, as you know, we have two blockades and either it's like one,

1:40 two or three, we lift it together.

1:43 I mean, right now the thing is that we're in the stalemate.

1:47 And I think the US is trying to change

1:52 this equation and try to move things too fast.

1:56 And, you know, because what the reality is

1:59 that Iran is good at negotiation, good at propaganda,

2:03 good at expansions through the proxies in the region,

2:07 but not good at winning wars.

2:08 They are good at inflicting damage.

2:11 And right now, I think the US government is

2:14 trying to end the way Iran is trying to exhaust.

2:17 And, you know, not only its own economy

2:20 but the global economy and trying to change the equation.

2:25 So in reality, you know, it seems like, again,

2:28 we're all learning the same maps of the Strait of Hormuz.

2:31 We now have a pretty good understanding.

2:33 It's a very narrow passageway and it seems like Iran holds most,

2:38 if not all, the cards in terms of safe passage through there.

2:42 If I'm an insurance company, I'm not letting my ship go through there.

2:46 Yeah, I think eventually what the US is hoping

2:48 is that other countries will join this kind of coalition.

2:51 So the US is taking the leadership

2:53 and some courageous insurance companies and, and you know,

2:58 allies from the US will take the risk.

3:02 I think that there is a there is a military strategy here to protect,

3:07 you know, the tankers.

3:09 We've air capabilities.

3:10 I mean and going, you know, through the Oman path.

3:14 Okay.

3:14 The Oman pass.

3:15 Let's bring it back to the secretary has to deal with the politics.

3:18 Why the chairman of the Joint Chiefs of Staff and Airman

3:21 Cooper and others have to deal with our military is well,

3:25 link natural gas and your expertise, Leslie Paul Guzman,

3:29 into how America really doesn't want to be in the war.

3:33 America's joining what I think in Patrick McHenry's old congressional district.

3:38 It's $4, $5 a gallon.

3:40 In L.A., it's $7 a gallon.

3:42 Link the American reality into the geopolitics of the Gulf.

3:48 Yeah.

3:48 So I think luckily, you know,

3:50 the US is a large one of the world's largest oil and gas producer now.

3:55 So it means that the US is the most isolated

3:58 right now compared to many other countries around the world.

4:01 Doesn't mean that there is not a risk of inflation, higher gasoline prices.

4:07 But if you look at Henry home prices

4:09 and where prices are below $3 per million BTU.

4:12 So, you know, the generally speaking,

4:16 the US economy is in a much better position than the rest of the world.

4:22 So again, if the Strait were to be magically opened tomorrow,

4:27 how do you think oil prices would react?

4:30 And is there a I guess, a longer term premium now put into oil coming

4:34 out of that part of the world, do you think?

4:37 So generally speaking, I think markets have been optimistic.

4:39 You know, the they are waiting, you know, one week,

4:43 two weeks like that, things may start to be more hopeful and and open up.

4:48 I think, you know, now by mid-June.

4:50 That's kind of the new thinking that things could really start to flow

4:54 again or but that definitely by the summer there will be an improvement.

4:59 So I guess who kind of blinks here?

5:04 Is it a ship owner?

5:06 Is it an insurance company?

5:07 Is it a captain on the bridge of one of these ships?

5:10 How does this actually happen?

5:12 Do you think it's going to be a mix,

5:15 But I think it's going to be countries like allies from the United

5:18 States that are going to show a good gesture and say,

5:21 okay, we trust that we have the confidence to go,

5:24 but with all your abilities and skills.

5:27 The entire orbit, including the press conference we just heard,

5:32 circles around the president.

5:34 Do you see a president who in any way wants

5:38 to do any of the processes you did at Tufts years ago?

5:41 I just don't see the linkage of Kissinger's 1200 pages.

5:45 We all read it.

5:48 Diplomacy with this president of the United States.

5:52 But again, I think that, you know, the surrender,

5:55 we don't know if it will happen or not,

5:58 but I think it's too early to call it, you know, a quagmire.

6:02 I think it's many outcome are still possible.

6:05 And we I think the negotiations are still, you know,

6:09 a possibility as well as kinetic restart the war.

6:12 Both are on the table.

6:14 And it's going to depend on what Iran also wants to do.

6:17 I think, you know, the conditions of ending

6:19 the war and so on, that's still on the table.

6:22 Paul wants to get into more intelligent questions.

6:25 Simple as I can it.

6:27 What price of a gallon of gas does this dialogue change?

6:33 I think for now I see a lot of determination

6:36 from the president and he's not willing to back down.

6:40 Liquid, natural liquefied natural natural gas, I call it natural gas to LNG.

6:46 That's why they have this nice acronym, LNG,

6:48 that seems to be an increasingly valuable commodity here.

6:51 Talk to us about the LNG market.

6:54 And I mean because the U.S.

6:55 is a big player in that.

6:56 Yeah.

6:56 So definitely right now the U.S.

6:58 is a big winner with LNG.

7:01 So the U.S.

7:02 was already the world's largest LNG supplier and we have

7:06 been like the ninth liquefaction project that just started last week.

7:12 And all the liquefaction plants in the U.S.

7:14 are running at full capacity.

7:16 The other second largest supplier is Qatar,

7:19 which is right now unable to export any of its LNG.

7:24 But, you know, you started with how to make a lemonade out of lemons.

7:29 I think Qatar is thinking ahead on how to transform

7:32 this crisis into an opportunity by potentially changing its business model,

7:36 moving away from the Strait of Hormuz and in.

7:41 But at the end of the day, regaining the trust from the buyers would be key.

7:46 But I think Qatar has the possibility to slow to slow start to slow restart its

7:52 liquefaction plants and then clear the glut because

7:55 we were in a glut in the LNG markets.