It is a rum old business when you cannot cover your costs. Just ask the owners of vessels ferrying liquefied natural gas across the seas. Spot charter rates in the Atlantic have plummeted more than 90 per cent since November to $4,000 a day, causing them to spring a leak.
An expected boom in LNG — driven by Europe’s pivot away from Russian gas and gung-ho US projects — has unleashed a flurry of shipbuilding. Yet the global supply of the liquid fuel grew just 2.5 per cent last year, a fraction of typical annual average growth in recent years. The extra 10bn cubic metres was less than one-third of the extra seaborne capacity.
The resulting losses are painful for ship operators, but not permanent. Manufacturing ships is an up-and-down game. Vessels take time to build; just not quite so long, it transpires, as it takes to get LNG plants online.