LNG shipping market conditions remained tightly balanced in recent weeks as disruptions linked to the Strait of Hormuz, shifting Atlantic and Pacific demand patterns, and uneven vessel availability continued to influence chartering activity and freight rates.
Some significant LNG shipping developments in the Middle East over the past week, as both 𝗤𝗘𝗟𝗠 and 𝗔𝗗𝗡𝗢𝗖 vessels are reported to have transited the 𝗦𝘁𝗿𝗮𝗶𝘁 𝗼𝗳 𝗛𝗼𝗿𝗺𝘂𝘇 on laden voyages. This marks the first LNG cargoes loaded within the Gulf to exit via the Strait of Hormuz since conflict began in late February.
In the East, sparse May cargoes coupled with ample supply has led to 𝗵𝗼𝘁 𝗰𝗼𝗺𝗽𝗲𝘁𝗶𝘁𝗶𝗼𝗻 across the tonnage classes for prompt requirements, while 𝗤𝗮𝗹𝗵𝗮𝘁 𝘃𝗼𝗹𝘂𝗺𝗲𝘀 continue to provide opportunities to owners that can call there. Requirements are emerging for June but currently these are stacked towards the second half of the month, leaving space for 𝗶𝗱𝗹𝗲 𝘁𝗶𝗺𝗲. Requirements out of the US East Coast and especially West Africa are enticing owners to 𝗿𝗲𝗽𝗼𝘀𝗶𝘁𝗶𝗼𝗻 𝘁𝗼𝗻𝗻𝗮𝗴𝗲, offering attractive utilisation and a 𝗿𝗮𝘁𝗲 𝗽𝗿𝗲𝗺𝗶𝘂𝗺 to Pacific cargoes.
The Atlantic market has proved stubborn, with rates remaining 𝘁𝗶𝗴𝗵𝘁𝗹𝘆 𝗯𝗼𝘂𝗻𝗱 in the mid-$90k/d range when accounting for vessel specifications. The requirement list has been 𝘂𝗻𝗲𝘃𝗲𝗻, with relatively 𝗳𝗲𝘄 𝗰𝗮𝗿𝗴𝗼𝗲𝘀 in early June set against an 𝗲𝘅𝘁𝗲𝗻𝘀𝗶𝘃𝗲 𝗹𝗶𝘀𝘁 from mid-June onwards. We may therefore see a little more 𝘃𝗮𝗿𝗶𝗮𝗯𝗶𝗹𝗶𝘁𝘆 as charterers face more or less competition for individual requirements, but the 𝗳𝘂𝗻𝗱𝗮𝗺𝗲𝗻𝘁𝗮𝗹𝘀 are showing no signs of change in the coming weeks.
Multi-month coverage through Q3/Q4 remains of interest but charterers have 𝗲𝗮𝘀𝗲𝗱 𝗯𝗮𝗰𝗸 on taking on tonnage. The 𝗯𝘂𝗹𝗹𝗶𝘀𝗵 𝘀𝗲𝗻𝘁𝗶𝗺𝗲𝗻𝘁 of the major portfolio players has trickled through the market, and we do see some additional subletters hoping to lock-in 𝘂𝘁𝗶𝗹𝗶𝘀𝗮𝘁𝗶𝗼𝗻, and this may explain the “wait and see” approach among charterers now.
Source: Fearnley LNG
