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Global LNG shipping rates double since end-August, slow Asia deliveries

Published 23/10/2018, 10:27 pm
Updated 23/10/2018, 10:30 pm
© Reuters.  Global LNG shipping rates double since end-August, slow Asia deliveries

LONDON/SINGAPORE, Oct 23 (Reuters) -

* Headline rates for shipping liquified natural gas (LNG) in Pacific and Atlantic basins stand at around $140,000 to $150,000 a day for a 160,000 cubic metre LNG tri-fuel diesel electric (TFDE) vessel, brokers say.

* That is a 6-year high and compares to Atlantic basin rates of $75,000 at the end of August and around $95,000 at the end of September.

* Rates have jumped due to supply from new plants, longer distances travelled and anticipation of higher prices prompting shippers to lock in longer-duration contracts. "Charterers continue to lock in multi-month contracts ahead of the winter and we continue to believe LNG shipping rates will remain strong due to very attractive supply/demand fundamentals in the coming quarters," Jefferies said this week.

* The high rates have slowed down spot LNG deliveries in Asia, said an Asia-based LNG trader, as shipping at such prices can account for over 10 percent of the price of LNG itself.

* Asian spot LNG prices have fallen for the fourth week running thanks to fresh supplies from Australia, lower oil prices and the absence of Chinese buyers. LNG/

* Individual spot deals for shipping LNG have been heard as high as $200,000 a day in Asia, one broker said.

* High shipping rates however have not deterred cargoes from Northwest Europe which is receiving an unusually high level of LNG even in the run-up to winter.

* European LNG supplies tend to come from Qatar, Africa and Russia, with shorter distances needing to be shipped and at lower LNG prices.

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