Rates to ship LPG on very large gas carriers (VLGCs) continue to exceed USD100/tonne despite almost no activity taking place in the Gulf.
The Baltic Exchange assessed the benchmark rate from the Gulf to Asia Pacific at USD108.375/tonne on 19 May, up from USD101.625/tonne a week ago.
At current bunker prices in Fujairah, that works out to daily earnings of USD105,232.
A Singapore-based broker told IHS Maritime, “We’re not seeing anything fixed in the Gulf. All the action has been in the west of Suez. We think that rates should start falling from June, when the ships start returning to the Gulf.
“A number of ships remain held up in India while other ships have ballasted to the west of Suez where there is a premium over the Baltic rate.”
Kuwait Petroleum Corporation eventually fixed Aurora Leo, for USD112/tonne for a trip from Kuwait to Asia Pacific, to replace its original ship that was held up in India.
A second broker said, “That’d be an exception in today’s market. Many charterers are holding back on Gulf-Asia Pacific fixtures because the freight costs are too high for them.”
He said that Algeria-Asia Pacific rates are estimated at USD168.50/tonne and Houston-Asia Pacific rates are around USD246.50/tonne.
Even then, reported fixtures suggest downward pressure on rates, as international LPG trader and shipowner Petredec fixed Yuricosmos for USD160/tonne for a Nigeria-Japan trip.