Number of Idling LNG Ships Mounts as Business Thins

Over 30 LNG carriers are idling as spot trading of cargoes slows across all markets, leaving vessels without employment.

News ID: 72595

Date: 25 February 2017 - 17:10

According to MANA, Numbers vary widely as to how many vessels are taking downtime, with figures heading towards 20 ships in the Far East and the balance either off Fujairah in the Middle East or waiting for business in the Atlantic Basin.

Brokers say that on top of the idling tonnage, around 20 LNG carriers are laid up.

The picture is in stark contrast to the global LNG trading fleet status seen last month when at one point the number of LNG vessels idling fell to single digits.

“The spot side is going to be grim,” said one owner, suggesting that it will likely take until September or later this year before any real improvement is logged.

Brokers indicate that some owners are now lowering the charter rates they are offering and dropping ballast bonus demands.

Daily rates for modern tri-fuelled, diesel-electric vessels are now being quoted in the $30,000 range, with steam-turbine ships in the low $20,000s or less, one says

There are, however, glimmers of activity.

Argentina’s Enarsa gave some hope to flagging interest recently with a tender for 14 cargoes that was swiftly followed up by a second tender for a further nine shipments.

But brokers say it is hard to see how, or if this will translate into significant increased demand for tonnage.

Elsewhere, Cheniere Energy is in the process of firing up its third LNG production train and is in the market with commissioning cargoes. But again market players are not optimistic that this will make any impact on idling tonnage, suggesting that vessels are already in place for such shipments.

Most market players seem to have their eyes firmly fixed on the latter part of 2017 for any firm signs of recovery for LNG shipping.