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LNG Market Snapshot – July 2016

  • We expect at least 6 newbuilds to enter the market this year
  • The global LNGC fleet grew by 1 vessel to 428, the order book by 1 vessel to 133
  • General vessel oversupply further reduced fleet utilisation to 85.28%, further deliveries could reduce it to around 80%
  • However, the slight increase in layups was enough to lift the monthly average spot charter rate to $24,750/day, roughly in line with our 12-month target range of $25-35,000/day
  • Steam-powered LNGCs struggle to improve their charter rate prospects in light of oversupply of newer DFDE/TFDE competitors
  • Far Eastern LNG market in particular appears saturated with Japan and South Korea returning to nuclear
  • Bright spot offered by emerging Southeast Asian buyers such as India, Pakistan and Thailand, with significant energy supply gaps to be filled
  • Innovative supply models are being tested but will not necessarily benefit the spot charter market

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by Alexander Wilk // 21 July, 2016

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