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All eyes on the Middle East regarding liquefied natural gas and crude oil exports

Posted at 10:20 PM, Jul 09, 2019
and last updated 2019-07-09 23:26:29-04

CORPUS CHRISTI, Tx. — With conflict brewing between the U.S. and Iran, some Americans have expressed concerns that sanctions imposed by the U.S. could disrupt liquefied natural gas markets here at home.

"The attacks of the tankers coming through the Strait of Hormuz have really kind of spooked the market," Iain Vasey said.

However, District 27 Congressman Michael Cloud said there is no reason to panic.

"We're talking about a hypothetical here when it comes to Iran," Cloud said. "Iran is known for making big, bold statements and having little action behind it."

Vasey, CEO of the Corpus Christi Regional Economic Development Corporation, said conflicts could result in a global domino effect.

"For us, the most important thing when we're looking at the Iranian attacks on some of the oil tankers is the market for LNG and natural gas is more and more coming out of Qatar," Vasey said. "It's one of the largest natural gas producers in the world and they're shipping most of their product to China and India and South Korea, so there's going to be a knock-on effect with this instability in the Gulf States."

Cloud said the U.S. is keeping a proactive, watchful eye on any reaction from China. "The big deal will be to see is how China will react to this. The big thing to note, though, is that we have more of a demand right now when it comes to LNG, so there's still a great potential for LNG," Cloud said. "It becomes a little bit of a shell game when you try to predict what may happen."

Vasey agreed with Congressman Cloud that the Port of Corpus Christi and overall South Texas economy could actually have the upper-hand in global affairs moving forward.

"With U.S. produced natural gas through LNG and producers such as Cheniere in our area, it's stable, it's predictable, and it doesn't have to go through the Strait of Hormuz as Qatar natural gas would be," Vasey said. "You want stability, predictability and safety, and that's one of the things that in South Texas, we might be able to take advantage of in the long run."

KRIS 6 News contacted Cheniere Energy, one of our local liquefied natural gas exporters, for a comment regarding this story, but did not hear back.