The UP World LNG Shipping Index (UPI) declined 3.21% last week, closing at 163.90 points. As winter progresses, LNG shipping companies with modern fleets are expected to secure new long-term contracts, though spot rates remain unchanged or declined.
The past week saw a slightly above-average trading volume of shares, though trading was shortened due to President Carter's funeral. Asian stocks faced the most losses, while Euro-American companies saw gains.
UPI & SPX
Last week, the UP World LNG Shipping Index (UPI), which tracks listed LNG shipping companies, lost 5.43 points, equivalent to 3.21%, closing at 163.90 points. The S&P 500 index lost 1.94%. The chart below illustrates the performance of both indices with weekly data.
Broader view
As winter gets underway, there is growing hope for companies with modern boats to announce new long-term contracts. Spot rates may not have moved yet, but demand for LNG is growing, and shipping efficiency will play an increasing role, especially with potential re-routing between Europe and Asia.
Constituents
The UPI fell on slightly above-average volume last week. It should be noted that the past week was not a complete trading week in the US either due to President Carter’s funeral. However, Asian companies lost mainly, while some Euro-American companies saw significant gains. The ratio of risers to decliners was higher in favour of the latter.
The biggest gainer was Tsakos Energy Navigation (NYSE: TEN), which added 10.2% after Friday’s gain and was the only one to achieve a 2% increase.
Flex LNG (NYSE/OSE: FLNG) completed its second week of growth by returning above the $25 support level, closing just below $26 after a weekly gain of 7.5%.
Further gains were no more than four per cent. Chevron (NYSE: CVX) rose 3.6%, BP (NYSE: BP) added 2.7%, and Cool Company (NYSE/OSE: CLCO) rose 2.7%. Nakilat (QSE: QGTS) added 1.8%.
Of the declining companies, New Fortress Energy (NASDAQ: NFE) was the biggest loser, correcting 8.8% after two weeks of gains. “Coincidentally,” it’s having trouble breaking the previous downward gap between $16.12 and $17.03.
Japan’s “K” Line (TSE: 9107) was a close second, with an eight per cent drop.
Excelerate Energy (NASDAQ: EE) gave up 6% and continues to move sideways, hovering just above its 2022 and 2023 peaks. It’s not yet clear to us which direction it intends to go.
NYK Line (TSE: 9101) has lost 5.7% and is going sideways. MISC (KLSE: 3816) has fallen back to the price levels of early last year after losing 5.3%.
Golar LNG (NASDAQ: GLNG) has a similar trend to EE – moving sideways at the high end of its prior advance. The range is roughly identical to the weekly decline of 4.9%.
The latest Japanese representative – Mitsui O.S.K. Lines (TSE: 9104) – is down 3.6%, yet its chart maintains an uptrend.
Dynagas LNG Partners (NYSE: DLNG) was down 1.8%, but it, too, only corrected its previous rise.
Crystal Ball
Our short-term outlook stays unchanged and is cautiously optimistic. Our long-term view is still positive, and we expect situationally or management-driven actions and potential new long-term contracts.
Established in 2020, the UP World LNG Shipping Index is a rules-based stock index family designed to measure the performance of worldwide publicly traded companies involved in the maritime transport of liquefied natural gas (LNG). This unique index covers 19 companies and partnerships worldwide, representing over 65% of the world’s LNG carrier fleet in 2020. The UP Index offers premium services with freemium and trial access to charts. With Freemium, users can access the basic UPI vs S&P 500 chart after email registration. The trial includes full access for fourteen days.
Source: By Tomas Novotny, UP-Indices.com