Baltic Exchange adds new LNG-powered vessel indices

The London-based maritime industry information provider Baltic Exchange put into operation a new set of independent indices for the LNG seaborne trade.

They are based on the carriers burning LNG, rather than marine fuel oil or marine gas oil, as their primary fuel, and are published twice a week.

The new indices, which went live on 2 March, are given the acronym BLNGg. They will be published alongside the Baltic Exchange’s current LNG indices which are based on LNG carriers fuelled by very low sulphur fuel oil (VLSFO). Historical data for the new indices will be available dating back to 1 January 2020.

The new standard Baltic vessel has the following speed and consumption specification when burning LNG as a fuel:

• 17 knots on 210 cbm LNG/day laden
• 16 knots on 190 cbm LNG/day ballast
• 0.1 per cent boil off
• Port consumption 42 cbm LNG/day idle
• Port consumption 85 cbm LNG/day working

US dollar per day assessments are available on the following routes:

• BLNG1g Australia to Japan RV
• BLNG2g US Gulf to Continent RV
• • BLNG3g US Gulf to Japan RV

CME Group wants to launch three new futures contracts based on these indices on 22 March 2021, after the regulatory review.

Commenting on this, the global head of energy at CME Group Peter Keavey said: “As LNG markets continue to evolve globally, demand for new tools to manage the risk around its transportation is also growing rapidly. The introduction of contracts based on the usage of LNG as bunker fuel among global shipping routes is the next step in the evolution of freight and provides another market-based solution to help our customers to manage their global gas risk.”

The majority of LNG carriers have switched to LNG boil-off gas rather than burn low-sulphur fuel oil, marine gas oil, or install emissions abatement technology, since the introduction of the 2020 Global Sulphur Cap by the International Maritime Organization (IMO).