Shipping Network News, LNG operator Flex LNG released its first quarter 2026 results on May 13. Flex LNG expects a stronger market environment due to the blockade of the Strait of Hormuz.
Flex LNG CEO Marius Foss stated that the first quarter 2026 results reflect the seasonal downturn in the LNG market, consistent with historical patterns.
Flex LNG’s earnings were impacted by a weak spot market environment and higher voyage costs.
He noted, however, that the LNG shipping market underwent a sharp reset after the US and Israel launched military operations against Iran in late February. The global LNG shipping market experienced severe disruption due to the interruption of Qatari supply and the closure of the Strait of Hormuz, causing spot prices to surge from a cyclical low of $20,000 per day in February to over $250,000 per day.
He stated that importantly, Flex LNG had no vessels trapped inside the Strait of Hormuz during the conflict.
He emphasized that the Board is pleased to announce another quarterly dividend of $0.75 per share, totaling approximately $41 million. This marks Flex LNG’s 19th consecutive regular quarterly dividend of $0.75 per share. Including special dividends, Flex LNG will have returned approximately $810 million to shareholders since 2021.
Specifically, in the first quarter of 2026, Flex LNG achieved operating revenue of $80.457 million, a year-on-year decrease of 9.0% and a quarter-on-quarter decrease of 8.1%; operating profit was $34.199 million, a year-on-year decrease of 27.6% and a quarter-on-quarter decrease of 19.8%; adjusted EBITDA was $53.162 million, a year-on-year decrease of 18.9% and a quarter-on-quarter decrease of 14.0%; net profit was $19.511 million, or $0.36 per share, a year-on-year increase of 4.2% and a quarter-on-quarter decrease of 9.5%.
In the first quarter of 2026, its fleet average TCE reached $65,729 per day, a year-on-year decrease of 11.0%.
Upward Revision of Full-Year 2026 Guidance
To reflect the stronger market environment, Flex LNG has raised its full-year 2026 guidance. It now expects fiscal year 2026 revenue to be between $345 million and $370 million, an increase of approximately 10% from the February forecast. Flex LNG expects its full fleet average daily TCE for fiscal 2026 to be $73,000-$78,000, an increase of approximately 8%, while adjusted EBITDA is now expected to be between $255 million and $280 million.
As of now, Flex LNG operates 13 VLGCs of 174,000 cubic meters. Flex LNG has secured revenue for 91% of its fleet operating days in 2026. The total firm duration of its time charter contracts reaches 54 years, which could extend to 81 years if charterer options are included.
Market Outlook
Spot market LNG carrier rates steadily declined from their peak in early December 2025, falling to a low of $20,000 per day in February, where the market eventually bottomed out.
Since the US and Israel launched military operations against Iran, the LNG shipping market has experienced unprecedented disruption. Following the escalation of the conflict, the market recorded its largest ever sequential increase in spot earnings, with modern two-stroke vessel rates surging from $30,000 per day to over $250,000 per day. Although rates have since pulled back, the LNG shipping market remains firmer than before the conflict, with shipbrokers reporting current spot rates around $85,000 per day.
Data shows there are currently approximately 750 LNG carriers in operation globally. As of April 2026, the LNG carrier orderbook stands at approximately 295 vessels, with the orderbook-to-fleet ratio at around 40%.
In the first quarter of 2026, LNG carrier ordering further accelerated, with 35 vessels ordered in the quarter, matching the total number of orders for the full year 2025. Meanwhile, only 20 vessels were delivered in the first quarter, leaving approximately 70 to 75 vessels scheduled for delivery in the remainder of 2026. Deliveries of 98 vessels are expected in 2027, and 120 vessels after 2028. Currently, newbuilding prices at Korean shipyards are approximately $250 million per vessel, with deliveries expected in 2029.
Flex LNG noted that the near-term market will largely depend on three key variables: the reopening of the Strait of Hormuz, the rate of increase in undamaged Qatari production, and the latest timeline for the North Field Expansion project. These factors will collectively determine whether the recent market strength evolves into a more sustained tightening cycle or proves to be a temporary rebound against a backdrop of increasingly loose structural market conditions.
