VLGC owners are continuing to enjoy strong spot earnings after the sector’s best year ever in 2023.
Clarksons Research said “steady” market conditions persist, with rates elevated amid firm fixing activity in Asia.
West of Suez, the market ended last week on a more bearish note after a narrowing of the price arbitrage.
But the research arm of broker Clarksons said spot earnings on the Houston to Japan route remain very firm at $136,972 per day.
The company described 2023 as “exceptional”, with earnings on the same route averaging a record $97,128 per day.
The Baltic Exchange assessed the Middle East to Asia run on Monday at $121,200 per day, up 15% over the past month.
Norwegian broker Fearnleys said the January fixing window in Asia should now be more than halfway through, with cargoes being matched to VLGCs for dates around 20 January.
The vessel position list is said to be relatively large, but many units are expected to make their way west, given Asia remains at a discount on freight.
In the west, the Oslo shop said the tonnage list means more or less every ship arriving in the US in the first 20 days of February is ballasting in from the Cape of Good Hope to avoid the dangerous Red Sea region.
One of the strongest starts ever
Owners were already routing their vessels away from the congested Panama Canal.
Fearnleys logs six spot fixtures already done for February.
The broker’s investment banking division, Fearnley Securities, said this has been one of the strongest starts to a year for VLGCs, with the market holding firm.
This bodes well for company results in the first quarter and into the second three months the longer the market continues, it believes.
Fearnley Securities has a “buy” rating on BW LPG and Avance Gas shares, and a “hold” for Dorian LPG.
