$300,000 a day: LNG freight rates scale new heights

The scramble to source gas from ever further distances has pushed the LNG shipping sector to new extraordinary highs.

Average spot rates for a 174,000 cu m two-stroke vessel surged by 36% week-on-week to a new record high of $297,500 a day, as of late on Friday, 23 Sep according to Clarksons Research.

Positioning fees are now being included in negotiations and fixtures, driving up round-trip rates with both the Atlantic and Pacific basins reporting a frenzy of fixtures.

“LNG carrier rates continue to see strong upwards momentum due to a very tight ship available list,” a recent report from Jefferies observed, adding that the sector had benefited from strong demand out of both Europe and Asia for US-origin cargoes.

According to a recent post on LinkedIn from OysteinKalleklev, the CEO of Flex LNG, demand in Europe, Japan, South Korea, Taiwan and Thailand is expected to increase by a total of 46.6m tonnes this year with Europe accounting for 85% of this increase as the continent weans itself off Russian pipeline deliveries.

.“LNG term rates have risen to multi-year highs and with a European push towards energy security we now project trade in 2030 of 630m tonnes versus last year’s 380m tonnes,” a new report from Clarksons Research forecast, helping explain today’s extraordinarily large LNG newbuildorderbook, which now stands above 40% of the extant fleet.