LNG Shipping Market Primed for Growth

By Jonathan Saul
Friday, March 5, 2021

Liquefied natural gas (LNG) ships are set to receive an earnings boost from restocking demand after colder conditions drove a scramble for supplies and record high freight rates, a top LNG tanker player said.

A cold snap in Europe and Asia in January and in North America last month increased heating demand, prompting prices to jump in several markets, while inventories fell.

"You need to replenish stocks because of the cold northern hemisphere winter in both Asia and in Europe. So, we think this is going to add to tonne miles," GasLog Partners chief executive Paul Wogan told Reuters.

Tonne miles are an indicator of shipping demand, measuring transported cargo volume multiplied by distance.

LNG tanker rates in January hit record highs of over $320,000 a day, with some charters concluded at around $350,000 a day, estimates from shipping sources showed.

Average earnings have fallen to around $20,000 a day on some routes, Baltic Exchange data showed.

Wogan said despite more tankers being delivered in 2021, rates could be "somewhere between $5,000 a day better than they were at last year".

"We think there's going to be about 20 million tonnes more LNG moved this year than last year," he said, adding that much of the additional production would come from U.S. producers.

Data from broker EA Gibson, based on AIS ship tracking, showed 14 LNG vessels had already been delivered this year with a further 44 scheduled to hit the water in 2021, which will add to the existing LNG fleet of 593 tankers.

Wogan declined to comment further on the agreement by subsidiary company GasLog Ltd to be taken private by BlackRock , the world's largest asset manager.

Gaslog Ltd's chairman Peter Livanos said last week the deal would allow "for access to growth capital currently absent in the public equity markets". 

(Editing by Barbara Lewis)

Categories: LNG Carriers LNG Tankers

Related Stories

Timor-Leste: Chuditch-2 Well to be Drilled at New Location Following Site Surveys

Akastor’s Subsidiary Wins $101M Case Against Seatrium's Jurong Shipyard

ONGC Hires Consortium to Deliver FEED Work for Bay of Bengal Oil Field

Dyna-Mac Secures $664M Backlog with New Contracts

Oil Spill Spotted Near Kazakh Oil Field in Caspian Sea

Mitsui to Develop Vietnam Gas Field for $740 Million

Saipem Loads Out Three Topsides for QatarEnergy LNG’s North Field Gas Project

ABS Awards AIP for OceanSTAR’s FSO Design

Are North Sea Jack-Ups Set for Flat 2024?

Valeura Buys Nong Yao Field’s FSO Aurora and Expands Wassana Drilling Campaign

Current News

Doris, Rosen and Spiecapag Team Up to Repurpose Natural Gas Pipelines for Hydrogen

Indonesia to Ask Mubadala to Speed Up South Andaman Gas Development

Interview: Caroline Yang, CEO, Hong Lam Marine & President, SSA

Indonesia Offers Five Oil and Gas Blocks, Pledges to Boost Exploration

ADES Holding Signs $94M Jack-Up Rig Deal with PTTEP

Cyan Renewables, Hyundai to Set Up Offshore Wind Vessel Suply Chain in South Korea

Mubadala Energy Makes Second Major Gas Discovery in Indonesia

Subsea7, OneSubsea to Install Türkiye’s First FPU in Black Sea

Optimizing Cathodic Protection Survey Using Non-contact Sensors

Into the Deep: Offshore Production Increasingly Finds Deeper Waters

Subscribe for AOG Digital E‑News

AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

https://accounts.newwavemedia.com