audi Arabia and key allies on Monday cut ties with Qatar, the world’s top seller of liquefied Natural Gas (LNG), stoking concern over any supply disruptions to neighboring countries spilling over into global gas markets.

Saudi Arabia, along with the United Arab Emirates and Egypt – both highly reliant on Qatari gas via pipeline and LNG – and Bahrain said they would sever all ties including transport links with Qatar, an escalation on past diplomatic spats.

They accuse Qatar, which supplies roughly a third of global LNG – natural gas that has been converted to liquid form for storage or transport – of supporting extremism.

As the rift lifted oil prices, LNG traders took a wait-and-see approach, alert to potential disruption of regional energy flows but erring on the assumption that any trade shocks could be contained given well supplied global markets.

Qatar’s top clients in Japan and India quickly received reassurances that supplies would continue as usual.

via Reuters