• 4 minutes Energy Armageddon
  • 6 minutes How Far Have We Really Gotten With Alternative Energy
  • 10 minutes Russia Says Europe Will Struggle To Replace Its Oil Products
  • 1 hour GREEN NEW DEAL = BLIZZARD OF LIES
  • 7 hours Reality catching up with EV forecasts
  • 11 days "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 1 hour Famous author Michael Crichton talks about the "Climate Change Religion" aka Feudalism 2.0
  • 5 days 87,000 new IRS agents, higher taxes, and a massive green energy slush fund... "Here Are The Winners And Losers In The 'Inflation Reduction Act'"-ZeroHedge
  • 10 days A Somewhat Realistic View of the Near Future for Electric Vehicles Worldwide

LNG Freight Rates Hit Record High As Europe Races To Secure Gas

LNG carrier rates hit an all-time high on Tuesday, driven by growing prompt demand for gas in Europe as the continent tries to procure supply ahead of the winter.

The freight rate to charter an LNG carrier in the Atlantic basin surged to $397,500 per day on Tuesday, according to Spark Commodities estimates cited by Bloomberg. 

The price to hire an LNG ship has now surged by 500% this year, as Europe is looking to import increased volumes of LNG to replace Russian pipeline gas, and north Asia is also preparing for the winter.

The new record for Atlantic LNG freight rates was higher than the previous record of $374,000 per day set on Monday, as assessed by Spark Commodities.

ADVERTISEMENT

Europe's demand has left few LNG ships available, and some buyers are now concerned they may not be able to charter vessels to bring in the gas, according to traders who spoke to Bloomberg.

Europe's demand for LNG surged by 65% in the first eight months of 2022 compared to the same period a year earlier, the International Energy Agency (IEA) said in its latest quarterly Gas Market Report earlier this month.

For the first time ever, the European Union imported in June more LNG from the United States than gas via pipeline from Russia, as Moscow slashed its supply to Europe. 

ADVERTISEMENT

In September, as much as 70% of all U.S. LNG exports were headed to Europe, up from 63% in August, per Refinitiv Eikon data cited by Reuters earlier this month.   

The race to buy LNG and charter LNG carriers could create the next big shortage in the energy market—not enough vessels to transport LNG from exporters to buyers, analysts and traders say.

The LNG shipping industry is set for a record-breaking quarter this quarter, and deals at freight rates of $1 million per day are not to be ruled out, according to maritime consultancy Drewry cited by Lloyd's List.  

By Tsvetana Paraskova for Oilprice.com

More Top Reads from Oilprice.com:



Join the discussion | Back to homepage

ADVERTISEMENT


ADVERTISEMENT


Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News