LNG freight volatility sees new contract listings

Exchange to launch new tools for LNG shippers to manage risk

LNG shipowners and charterers will next month have more options to manage fluctuations in shipping rates, which have seen a significant rise in volatility. Exchange Ice plans to launch two new LNG freight futures contracts on 22 March. The Spark25S (Pacific) spot price, which is an assessment of the day rate for an LNG tanker moving between Australia and Japan, Korea, Taiwan or China by price reporting agency Spark Commodities, peaked at $231,500/d in mid-January (see Fig. 1). A cold snap in Asia drove a spike in import demand and LNG prices, which put a significant premium on tonnage available to move cargoes into the region. The Atlantic Basin was just as vulnerable, with the equivalent Sp