LNG tanker rates soar as Asian gas demand spikes
Tanker rates to carry liquefied natural gas (LNG) surged 15%-35% over the past week to more than $150,000 a day, as Asia’s recovering economies and strong demand during the peak winter season led to a clamour for scarce ships.
Colder weather in some parts of north Asia, coupled with a supply crunch globally, has caused spot Asian LNG prices to spike to multi-year highs.
This has cut into ship availability as traders snap up vessels to either store gas or ship cargoes from the west to the east, several industry sources said.
The daily charter rate for shipping LNG in the Pacific basin rose to $194,500 a day on Tuesday, up from $114,750 a day a week ago, said Tim Mendelssohn, managing director at Spark Commodities.
The daily rate to ship LNG in the Atlantic basin rose to $178,750 a day, up from $131,250 a day last week, he said, adding that both rates are the highest since Spark’s indices began in mid-2019.
It was unclear if any deals for ship hires had been done at these rates but three shipbrokers said they estimated rates at $150,000 to $175,000 a day for both routes.
“It’s purely a demand and supply picture with no availability of ships,” one of the sources based in Singapore said.
This in turn could boost shipping rates further should traders need to sub-charter the ships, a second source said.
Still, with high spot prices turning away some buyers, tanker rates could start to come down from February, the first source said.