Atlantic LNG charter rates drop to seasonal low in September

LNG spot charter rates have fallen to a seasonal-low, with the Spark Atlantic spot freight assessment sitting at ~57$k/day as of mid-September.

This seasonal weakness has been largely driven by two factors:

• JKM-TTF spreads narrowed across August-September, as TTF month-ahead prices rose in response to perceived supply risks despite ample European storage. Narrower JKM-TTF spreads attract more marginal LNG supply to Europe, improving vessel availability through shorter average voyage times.
• Year-on-year charter rate weakness can also be attributed to the absence of a steep Oct-Dec contango across the forward curve (another effect of recent TTF month-ahead strength). In 2022 & 2023, this winter contango incentivised traders to float loaded LNG cargoes into later dated winter contracts, causing charter rates to surge.