High oil prices have driven suppliers to natural gas, but even recent supply battles like those between Iran and Turkey and Russia and Ukraine have left other customers without LNG, The Peninsula reported.

For instance, when Turkey had its supply cut by Iran, it was willing to pay much more than Britain for supply from places like Algeria.

Japan, Korea, China and Taiwan are also paying much more for LNG supplies than more developed nations whose bills continue to climb.

"Ten years ago, there was no way that a Japanese earthquake would have had any impact on gas prices in the U.K.," said David Cox, managing director of Poyry Energy Consulting in Oxford. "But now, as the market shifts to being more global, that potential exists."

Cairn Energy finds oil, gas in Bangladesh

Edinburgh-based Cairn Energy Ltd. recently announced new finds offshore in Bangladesh, but the government said oil and gas was only found in one of three offshore field areas, the Scotsman reported.

"The firm informed us that they have encountered hydrocarbon/petroleum in the structure which is not commercially viable," said Muhammad Muqtadir Ali, a director of state-run PetroBangla.

But Cairn, which has been in Bangladesh for more than 10 years, discovered new gas in a well at the Sangu offshore field.

The firm completed exploratory drilling in the Hatiya structure in the Bay of Bengal, 40 miles south of the port city of Chittagong, an official said.

"The firm will be able to add at least 25 to 30 million cubic feet per day of gas in its total production," another official said.

Earlier Cairn did not find any commercially viable gas in Magnama, another offshore field in the sea.

"Now the firm proposed to conduct a 3-D seismic survey in both the fields either in late December this year or early next year," Ali said.

Cairn will conduct an appraisal for a final decision after the survey is completed. The total cost for the survey and appraisal is estimated at $90 million.

PetroBangla has estimated there was a potential reserve of 3.5 trillion cubic feet of gas at Magnama and 1.8 trillion cubic feet at the Hatiya structure.

India's oil industry threatened by impending shipping tax

In India's next budget, ships hired to support drilling activities would attract a 12.5 percent service tax, making oil and gas exploration more expensive, Livemint India reported.

"To promote oil exploration activities along the county's coast, the government introduced a special tax regime for this industry in the new exploration licensing policy, wherein it (the sector) is exempted from all duties and levies. Why should the government impose a service tax on us now?" asked an official with Oil and Natural Gas Corp. Ltd., India's biggest oil explorer.

ONGC has hired at least 100 offshore support and supply ships, paying anywhere between $2,000 and $12,000 a day to shipowners. Hiring of oil drilling rigs is costlier with daily rentals in excess of $200,000.

The proposed tax comes at a time when new exploration is needed -- prices are at record highs and there's no sign the Organization of Petroleum Exporting Countries will increase production to ease them.

Both oil firms and local shipowners lobbied, however, the budget clarified that renting ships such as drilling rigs, offshore support and supply vessels, anchor handling tugs and other supply boats would come under the scope of the service tax.

Exploration companies are still resisting the tax. State-owned ONGC said it could not absorb the extra costs unless the government provides for it in the firm's annual budget.

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Closing oil prices, Mar. 17, 3 p.m. London

Brent crude oil: $108.13

West Texas Intermediate crude oil: $110.85

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(e-mail: energy@upi.com)