Atlantic LNG: Spot charter rates stem slide

Spot charter rates in both basins held on Tuesday, having tumbled in recent days amid greater vessel availability as vessels finished charter periods and re-entered the spot market.

Rates for spot fixtures of a tri-fuel diesel-electric (TFDE) vessel in the Atlantic basin were unchanged on Tuesday at $62,000/d, having fallen by $9,000/d from a week earlier, while the Pacific basin rate held $8,000/d lower than a week earlier at $54,000/d.

There remains ample tonnage demand in the Atlantic basin, market participants said, with a number of requirements posted by firms in recent days, including a prompt requirement from UK firm Centrica.

And vessel availability had not significantly outstripped demand, despite a number of firms moving vessels from the Pacific basin into the Atlantic in January.

Nigeria LNG cut spot availability in the Atlantic by three vessels last week, fixing them for prompt loadings at its Bonny Island export facility.

The awarding of Gazprom's 18-cargo fob Zeebrugge tender may also weigh on availability in the Atlantic, with the first cargo offered for the second half of February. The tender closed on Monday, with awards scheduled for Wednesday.

But prompt vessel availability in the Pacific basin has increased in recent days, as vessels ending charters in late February-early March were heard open again on the spot market, appearing to outweigh demand within the basin.

A number of fixtures have been done in the basin, primarily for loadings at Australian export facilities, signalling some tonnage demand among producers, but this has failed to match availability.

Concerns regarding China's prompt LNG demand may have curbed the appetite from firms selling into the country for securing spot tonnage to lift cargoes at the end of February and the start of March. This was likely a result of the potential for delayed delivery should China's domestic gas demand hold weak, or Chinese buyers declaring force majeure.

CNOOC did issue notices of force majeure to its suppliers last week, and it remained unclear if other state-controlled buyers have followed suit.

And the number of laden vessels holding offshore Chinese terminals in the South China or East China seas remained low on Tuesday, suggesting that charterers of these vessels were unlikely to be required to seek additional shipping capacity to ensure they maintained their respective loading schedules.

That said, owners had heard a small number of requirements posted for Pacific basin loadings last week as a result of delayed deliveries to China, and were expecting another 2-3 requirements to emerge this week, which have helped to stem the decreases in spot east of Suez freight rates.

The brief closure of Australia's Port Dampier may also have weighed on tonnage demand in the Pacific, with firms likely holding additional capacity as loadings were expected to slow.