Iranian attacks and the stoppage of seaborne transit have paralyzed Qatar’s vital gas exports, stalling the economic pivots intended to anchor the country’s growth.

In Qatar, a desert peninsula protruding into the Persian Gulf, natural gas turned the country from a pearl-diving backwater into one of the world’s wealthiest nations.

Qatar spent three decades building supply lines, shipping tens of billions of dollars of liquefied natural gas each year through the Strait of Hormuz to ports across Asia and Europe.

The state, which derives more than 60 percent of its revenue from gas and gas-related exports, used that money to transform the peninsula into a gleaming metropolis.

Then, in February, Qatar’s door to the world slammed shut.

The closure of the Strait of Hormuz means virtually no gas has left Qatar’s shore for more than two months. The nation is also cut off from the sea routes through which it imports everything from vehicles to produce. Fears of regional instability have hurt tourism and eroded business sentiment.

Ras Laffan, Qatar’s industrial center for gas production, is shuttered, and roads are blocked. At the vast Hamad port south of Doha, loading cranes stand paralyzed. Throughout the capital, hotels and boutiques sit in noticeable silence. Qatar’s growth forecasts have been slashed amid the cessation of L.N.G. trade.

Qatar’s economic transformation started in the 1990s. It made a large bet on supercooling gas from the North Field — the world’s largest natural gas reservoir, in Qatar’s northeast — to minus 162 degrees Celsius. This turned the fuel into a liquid, allowing Qatar to bypass regional pipelines and ship gas to every corner of the globe.

From the 1990s to the 2010s, the economy boomed, growing at an average annual rate of roughly 13 percent. To power this build-out, Qatar relied on an influx of foreign workers. Today, about 90 percent of its 3.2 million residents are noncitizens.

Seeking to build on that momentum, Qatar said in 2019 that it would expand the amount of L.N.G. its North Field could produce to 126 million tons a year by 2027. Before the war, its capacity was about 77 million. The expansion is considered one of the largest energy projects ever planned.

Then, in late February, much of that activity ground to a halt. Unlike its neighbors, Saudi Arabia and the United Arab Emirates, which have pipelines that can bypass the Strait of Hormuz, Qatar is geographically trapped behind the waterway.

Within 24 hours of the Iranian blockade, QatarEnergy, the state-owned energy giant, announced it couldn’t fulfill its contracts. Two weeks later, Iranian missiles and drones struck Qatar’s Ras Laffan plant, damaging critical equipment and causing a 17 percent reduction in Qatar’s production capacity.

The damage means that even if the strait were to open tomorrow, it would take years to return to prewar output. Analysts estimate that QatarEnergy has already lost billions of dollars since the war started, and every day that the strait remains closed, the country bleeds hundreds of millions more in lost sales and shipping charter fees.

The war has also exposed another kind of vulnerability. As part of a long-running effort to diversify beyond fossil fuels, Qatar has tried to transform itself into a tourist destination and a hub for international business and finance. Since the war began, however, the number of international visitors to Qatar has plummeted amid travel advisories from the United States and other governments. Many multinational companies, fearing regional instability, have sent staff out of the country. In March, the World Travel & Tourism Council estimated that the Middle East was losing $600 million a day in tourism revenue.

For Qatar, like many of its neighbors, the diversification strategy hinges on sustained foreign capital, a steady supply of expatriate labor and, above all, the perception of stability.

Economists forecast that even if L.N.G. revenue were to vanish for years, Qatar’s deep pockets would allow it to continue paying salaries and maintaining essential services. At the same time, the authorities have pressured international firms to return to prevent an exodus of foreign capital and talent. The concern is that if companies are allowed to collapse, the country’s overwhelmingly foreign work force could quickly disappear

See also:

• Gulf allies are quietly starting to break with Washington (The Hill)
• A New Order for the Gulf • The Region Must Build Its Own Security, Not Buy It (Foreign Affairs)
• Oil touches two-week high after drone attack on UAE nuclear power plant (Reuters)