LONDON
Asia is stocking up on liquefied natural gas (LNG) to avoid a repeat of last winter’s crunch when colder than usual temperatures sent 2020/2021 winter spot LNG prices to records.
Now prices are even higher, but many Asian buyers are still on the spot market despite the expensive gas in the global energy crunch, Oilprice.com reported. Surging demand for LNG and increased shipments of U.S. gas to Asia, including China, are sending spot LNG freight rates in the Asia Pacific region to new records.
This week, Pacific spot LNG freight rates jumped above $300,000 per day to a new record high, as rates in both the Pacific and Atlantic basins continued to move sharply higher, LNG freight assessor Spark Commodities said.
The spot price for LNG tankers to deliver fuel in December in the Pacific region jumped to an all-time high of $316,750 per day, up by 9 percent compared to the previous week. This beat the previous record for spot LNG rates set last winter when a cold snap in Asia drove LNG prices and freight rates to records.
Those records were beaten in the past few weeks when spot LNG prices in Asia jumped to well above $30 per metric million British thermal units (MMBtu) last month. Now LNG freight rates have also exceeded last winter’s all-time highs and are five times higher than in early September.
At the same time, the spot LNG freight rate in the Atlantic basin jumped by 5 percent from the previous week’s assessment to $254,250 per day this week, according to Spark Commodities data.
Soaring prices and LNG demand started to push spot LNG freight rates to over $200,000 per day in October, as traders scrambled to book vessels to ship the fuel to energy-starved markets in Asia. LNG tanker rates more than doubled in October alone amid high demand for vessels in the energy crisis, industry sources told Reuters at the time.
