As reported by Bloomberg, the expenses associated with transporting liquefied natural gas (LNG) across the Atlantic have reached their highest levels in nearly two years. This increase is largely driven by a rise in exports from North America, which has led to heightened demand for tanker vessels.
The daily spot rate for hiring an LNG carrier from the United States to Europe saw a significant jump of 19%, now standing at $98,250-marking its peak since January 2024. Additionally, rates in the Pacific region also surged by 15%, reaching levels not seen in over a year.
This shift represents a dramatic change from earlier this year when shipping costs were languishing at record lows due to an oversupply of available vessels. With North American production steadily increasing as new projects come online, there is an urgent need for more ships to transport this fuel to markets across Europe and Asia.
Data indicates that the average monthly LNG exports from North America have risen nearly 40% since the beginning of this year. However, these rising freight costs could lead to greater disparities between gas prices in Asia and Europe as it becomes pricier to ship US supplies across the Pacific Ocean. For instance, traders noted that one company secured a vessel for December delivery at approximately $100,000 per day.
Interestingly, when shipping rates were lower previously, some companies opted to send their vessels towards Asia instead-this decision further intensified vessel shortages within the Atlantic market.
Despite these recent spikes in charter rates, experts like Han Wei from BloombergNEF suggest that we may be nearing a peak. He notes that ongoing deliveries of new tankers will likely stabilize spot charter rates moving forward.
