As a spokesman of the new group, Baltic Exchange Chief Executive Mark Jackson said, “The growth in LNG transported by sea has led to the formation of a spot market. However, any spot market needs to be underpinned by standard contractual terms – as already happens in the tanker and dry bulk freight markets. The Baltic Exchange is looking to support the LNG freight market as it matures and we hope to deliver greater transparency through an index. We are delighted that four of the most important independent LNG shipbroking companies have joined our panel and we look forward to developing a set of standardised assessments for use across the fast-growing LNG industry.”
The remarkable global increase in natural gas production along with rising demands by India, China, Pakistan and Egypt has led to a fundamental change in LNG shipping market dynamics in the last few years. Additionally, more contracts are being signed for smaller quantities and shorter durations, without fixed destinations. Trade patterns have diversified as new import and export terminals have been built and the LNG fleet continues to expand. Upto now, the LNG shipping market was characterised by low levels of spot market activity, with the majority of business conducted on a long term contractual basis.
At the moment, The Baltic LNG Panellists Group evaluates various routes. Once finalised, their proposal will be presented to the Baltic Index Council for approval and trial phase.
