LNG Pacific Freight Rates Rise 30% in Week as Buyers Scramble for Vessels

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Spot day rates to charter LNG carriers in the Pacific have risen 30% over the past week, a second hike in rates in just over a week amid a tightening of availability east of Suez.

S&P Global Platts Friday assessed Pacific day rates for LNG vessels at $35,000, up from $27,000 a week ago, marking a sharp spike in rates for a market that had been static since early April.

Woodside is reported to be in discussions to use a Coolpool vessel for a mid-July load, although the deal has not yet been finalized, while a second vessel, the Grace Dhalia, was heard on subjects for loading out of Papua New Guinea.

Exxon was also heard to have fixed the Gaslog Salem for the end of June.

Hiring rate increases:

Shipping sources said the Woodside request will likely be the Gaslog Singapore loading out of Pluto, with a hire rate in the mid-$30,000s/day. One source said a positioning fee and a hire component above 50% with fuel is included in the ballast bonus, although this could not be corroborated.

Exxon also paid around the mid-$30,000s/day range for its vessel, sources said, with one saying it was done with round-trip economics.

Woodside Chaney will also be chartered by SK Shipping for a fixed period of two to three months. The vessel will deliver in the third quarter, and was heard to have been fixed in the high-$30,000s/day.

Big moves can affect gas prices:

These fixtures come on the back of three requirements reported last week, including a one- or two-year time charter from Indonesian LNG producer Pertamina, PetroChina requirement for a three-month charter from mid-July, and Shell’s search for a vessel to load in the first half of July.

Shipping typically accounts for 5-20% of the delivered price ex-ship of LNG, meaning big moves in rates can have a significant effect on the final price of gas.

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SourcePlatts

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