According to the latest Reuters report, the number of cargo-laden LNG tankers off the shores of Europe is increasing.
This congestion, and a subsequent rise in the number of vessels being designated as floating storage in the region, has been caused by the COVID-19 coronavirus pandemic, which has led to delays in the reception and discharge of tankers.
The situation is similar to events observed recently in Asia, and there is evidence to suggest a knock-on effect.
As lockdowns due to the pandemic began to limit Asian industrial gas demand, LNG cargo deliveries to the region began to be deferred, delayed and cancelled, leading to a buildup of floating cargoes.
Despite lockdowns in Asia now starting to lift, allowing some floated LNG tankers to unload, demand has remained limited and spot prices continue to hold at record lows. This has prompted some of the floated cargoes to be diverted to Europe, which is now contributing to the tanker congestion in that region.
Indeed, a Reuters source at Kpler, Nathalie Leconte, has reported that globally there are currently 15 LNG cargoes designated as floating and 11 of them are located in Europe. The other four are to be found offshore India and in the Far East. Leconte says, “because of oversupply and low prices in Asia, Europe has been a destination of last resort.”
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/01052020/coronavirus-causes-lng-tanker-buildup-in-europe/
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