LNG and LPG Markets Face Rate Pressures Amid Shifting Dynamics

By
Mfame Editor
-
19

  • Positive Start for LNG Period Market Despite Rate Adjustments.
  • LPG Market Softens as Middle East Gulf Fixtures Decline.
  • Oversupply of Vessels Adds Downward Pressure on LPG Rates.

LNG Market Overview

The LNG market was active as players returned to work from the holiday period. Yet more tonnage than expected came in, resulting in more choices for the cargos, and thus further pressure on rates, which had been resilient into the close of 2024. Brokers remain hopeful that fixing opportunities are still ongoing, reports Baltic Exchange

LNG Shipping Rates on Key Routes

BLNG1: Australia–Japan Route:

  1. 174k CBM 2-Stroke Index: Declined to $21,700.
  2. 160k CBM TFDE Index: Dropped to $14,000.

BLNG3: Houston–Japan Route

  1. 174k CBM Index: Fell by $800 to close at $30,500.
  2. 160k CBM Index: Rose by $1,100, ending at $20,400.

BLNG2: Houston–Continent Route

  1. 174k CBM Index: Declined by $979, closing at $24,021.
  2. TFDE Index: Increased by $800, ending at $16,400.

LNG Period Market Trends

The LNG period market started on a positive note, with an index-linked charter completed at a slight discount to the published rate. Baltic period rates for LNG were as follows:

  1. Six Months: $24,750
  2. One Year: $32,492
  3. Three Years: $44,300

LPG Market Overview

The LPG market started 2025 on a frosty tone. Far fewer-than-expected fxiates in the Middle East Gulf (MEG) for January, together with an extended position list and reduced number of stems, caused rates to soften.

LPG Shipping Rates on Key Routes

BLPG1: Middle East Gulf–East Asia Route:

  1. Rates dropped by $3.5, closing at $57.667
  2. Daily TCE earning stood at $39,025

BLPG3: Houston–Chiba Route:

  1. Rates declined by $7, closing at $102.5
  2. Daily TCE equivalent was $38,221
  3. Sentiment on this route remains bearish.

BLPG2: Houston–Flushing Route:

  1. Rates dropped by $3.75, closing at $56.875
  2. Delivered a TCE of $55,015 for the week

Market Sentiment and Outlook

The LNG market remains on an even keel as brokers stay positive with current rate pressure. Meanwhile, LPG remains under bearish influence, which was further aggravated by overcapacity coming from independent shipowners and subdued fixture activity. All these contribute to downward rate pressure. The participants remain cautious in the coming weeks as they keep a watch on supply-demand dynamics.

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Source: Baltic Exchange