The UP World LNG Shipping Index (UPI) showed a positive performance, increasing by 1.44%, reports LNG Shipping Stocks.
Increased Demand Expected
Gas buyers are beginning to replenish their storage, which is expected to increase demand for LNG shipping due to lower existing storage levels and new liquefaction capacity coming online. This increase in demand is anticipated to begin in the spring, influenced by gas prices and spot rates. Therefore, the outlook for the LNG shipping sector is positive.
Laura Page of Kpler, as quoted by Marwa Rashad of Reuters, noted that Asian demand for contracted LNG, particularly from Qatar, is strong, as oil-linked contracts are currently cheaper than spot prices.
The primary uncertainty remains the potential imposition of tariffs by the US administration.
The UPI (likely referring to a specific market index) has encountered resistance, preventing further upward movement. This week marked the third time this year that the index has faced this resistance, with some companies in the index performing better during the week than their final closing prices.
Notable Growth
Several LNG-related companies experienced notable growth, with New Fortress Energy (NFE) surging by 20.6% and Golar LNG (GLNG) increasing by 11.5%. This growth was attributed to positive news releases, including NFE’s contract extension with the Puerto Rican government and GLNG’s financing agreement for FLNG Gimi. Technical analysis also indicated potential upside for these companies.
Other companies, including Flex LNG (FLNG), Tsakos Energy Navigation (TEN), MISC, Nakilat, Cool Company (CLCO), and Awilco LNG (ALNG), also saw gains, albeit smaller. These gains helped to prevent the UPI (a market index) from breaking through its resistance level. Capital Clean Energy Carriers (CCEC) also saw a slight gain, though less than its weekly high.
In contrast, Chevron (CVX), BP (BP), and Shell (SHEL) capitalized on the market’s potential, recording significant increases. Excelerate Energy (EE) also saw a 3% rise.
Japanese UPI companies remained near their resistance levels, exhibiting gains and losses in the teens. Korea Line Corporation (KRX: 005880) experienced a 3% drop, returning to its support level.
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Source: LNG Shipping Stocks
