London: Rates for liquefied natural gas carriers have hit record levels on the back of enormous Asian demand.
“The shipping market will remain as tight as it is for the next two years,” said Fotis Giannakoulis, an analyst at Morgan Stanley in New York. “The weak European economy is not helping demand and they have excess capacity, so these imported volumes are available to be sent to Asia.”
Shipping costs reached a record $150,000 a day last month, according to Arctic Securities ASA, an investment bank in Oslo. They will average $152,000 this year, according to a Bloomberg survey.
This year might be a peak however as 22 LNG carriers join the global fleet in 2013, far more than the five required, according to Evercore Partners Inc (EVR), an investment bank in New York.
While New York-based Bernstein estimates global trade in LNG will expand 3 percent this year to a record 243 million tons, the distances involved in shipping cargoes to Asia will tie up vessels for longer periods. Demand for LNG carriers will rise 15 percent this year, more than three times faster than fleet growth of 4.6 percent, according to RS Platou.
“Re-exports from Europe are propping up this market,” said Erik Nikolai Stavseth, an analyst at Arctic Securities in Oslo. “They double up miles for cargoes.” [25/07/12]