Period charter rates for LNG carriers are showing slight signs of sliding lower from their firm positions in a market where spot have been plummeting downwards since late December.
Brokers highlighted Equinor’s sublet to BP of the 160,000-cbm tri-fuel diesel-electric (TFDE) LNG carrier Cool Runner (built 2014) for one year which was reported at around $140,000 per day, some $20,000 per day down on last done.
But one said that despite the apparent easing of rates on paper as period levels follow spot market levels’ downward trend owners are reluctant to accept much lower figures as they remain confident on demand for the second half of 2023.
Instead, he described the market as being “in the doldrums”, describing the overall weaker feel as “a first-quarter blip”.
Several brokers report that only a small pool of LNG carriers are showing open for the next winter period
Howe Robinson Partners said shipowners are looking for longer periods and other players in control of tonnage are considering subletting vessels for between one and three years to cash in on the strong returns on offer.
Affinity LNG said that any vessels open for the winter 2023 to 2024 period are “getting serious interest and short shelf life”.
The broker said high prices are being seen for vessels available for 12-to-36-month periods.
Others said charterers remain burned by the record rates they were forced to pay up for shipping in 2022.
Market players are eagerly watching for the results of two tenders for LNG newbuilding tonnage centred on vessels delivering from 2026 to get a handle on what charterers are willing to pay.
It is a different picture in the spot chartering sector, where the number of open vessels has ticked up as high storage levels, particularly in gas-hungry Europe, have given buyers more confidence.
Clarksons said spot charter rates for two-stroke modern vessels are down around 21% week-on-week to hold at around the $100,000-per-day mark.
The broker said average spot rates for a 160,000-cbm dual-fuel diesel-electric vessel fell 28% from the previous week to $67,500 per day. It said this was the lowest level since August 2022, adding “further declines are expected in the coming weeks”.
Affinity LNG dropped its spot rates for two-stroke vessels trading in the Atlantic to between $75,000 per day and $85,000 per day but is quoting them at $105,000 for ships open in Asia and the Middle East.
Vessel availability in the Atlantic is much higher, where brokers were quoting at least nine cold ships as open, than in the Far East, where the figure was nearer four and rising as the Lunar New Year holidays dampened demand.
But the recent cold snap in Europe could see the numbers slim for the Atlantic basin tonnage over the coming days.