Spot TCE earnings go below TC rates

LPG World Markets

July 2020

VLGC freight rates have nosedived in the past two months amid lower export volumes from the US in 2Q although overall US exports registered robust year-on-year growth rates in 1H 2020. In addition, LPG exports from the Middle East registered a year-on-year decline in 1H 2020 driven by oil production cuts. Unfavorable arbitrage economics to ship US barrels to the East and to Europe/Med weighed on US exports creating a long list of available prompt vessels. On a time charter equivalent basis, VLGC spot rates for AG-Japan voyages declined below Poten’s one-year average TC assessment in June.

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