Summary
LNG shipping stocks posted a slight decline last week, with the UP World LNG Shipping Index (UPI) edging down 0.34% to 166.39 points against a sharper drop in the S&P 500. Despite the modest move, market dynamics were lively, driven by significant swings in individual stocks. Notably, New Fortress Energy plunged 25.3%, while Awilco LNG, Cool Company, and Flex LNG recorded doubledigit gains, all testing key resistance levels amid higher trading volumes. Japanese carriers, Nakilat, and Chevron hovered near resistance but failed to break through. Broader sentiment improved as fears over spot rates eased, and new index constituents from ADNOC and COSCO promise to expand sector coverage going forward.

UPI & SPX

The UP World LNG Shipping Index, which tracks listed LNG shipping companies, lost 0.57 points (0.34%), closing at 166.39 points, while the S&P 500 index lost 2.36%. The chart below illustrates the performance of both indices with weekly data.

New constituents
On July 25, the regular quarterly rebalance of the UP World LNG Shipping Index (UPI) was completed. During this update, two new constituents were added to the index:

With these additions, the UPI now tracks 21 publicly listed companies and partnerships from across the globe, providing broader coverage of the global LNG shipping market.

Broader view
At the end of last week, the US administration set a deadline for negotiations on new trade tariffs.

As the deadline approached, stock markets began to adopt a negative outlook, reaching a peak of concern on Friday. The UPI showed a minor decline of 0.3%, indicating a slight loss. However, there were notable double-digit fluctuations in both directions throughout the week. Trading volume was slightly above average.
Interestingly, concerns about the development of spot rates and their impact on publicly traded companies have significantly eased. This could be attributed to more moderate growth, but primarily it relates to the influence of spot rates on individual companies. According to our data, the daily time charter equivalent (TCE) for UPI companies remains around $70,000 per day, largely due to long-term contracts. This stability may also be linked to the ongoing scrapping of old steamships, which has now reached double digits, as reported by Lucy Hine from TradeWinds.

Given the exceptional volatility of the week, we will provide a detailed description of individual
movements, whether positive or negative. This approach will effectively highlight the dynamics of these movements.s

Constituents
New Fortress Energy (NYQ: NFE) again showed the most significant movement, this time falling by 25.3%. This reflects a combination of optimism about recovery efforts and ongoing high debt.

In second place is Awilco LNG (OSE: ALNG) with a 13.1% increase, which at one point rose above NOK 4.50, a level last seen at the beginning of this year. The closing price was NOK 3.5, and the exchange rate remained at resistance.

Cool Company (NYQ/OSE: CLCO) posted an increase of almost 10%, but also remained below resistance. However, the increased volume suggests the importance of this threshold.

Flex LNG (NYQ/OSE: FLNG) recorded an eight per cent increase, confirming expectations of upcoming growth. This occurred on Monday, after which it slowed slightly for the rest of the day.

The price closed again in the resistance zone. Here, too, there was significantly above-average volume, especially at the start of the growth on Monday.

Excelerate Energy (NYQ: EE) rose 7.2%, correcting its decline for the first time since mid-June. Here, too, volume was above average, with the price rebounding from support at $ 23.70 but failing to reach the $25.85 level, which could have provided additional support.
SM Korea Line Corporation (KRX: 005880) recorded a decline of 4.9%. An attempt to break through 2000 won turned into a decline.

Apart from Exmar NV (BSE: EXM), which reported 3% growth, there are several companies with movements of around 2%. The group comprises all three Japanese companies (NYK Line – TSE: 9101, MOL – TSE: 9104, and “K” Line – TSE: 9107), Nakilat (QSE: QGTS), Chevron (NYSE: CVX), and Capital Clean Energy Carriers (NYSE: CCEC).

All of these companies have declined, but all have either unsuccessfully attempted to grow or remained close to their resistance levels.
Overall, there is no shortage of appetite for growth in the LNG shipping sector, but external global circumstances are currently more favourable.

Crystal Ball
Despite the growing global uncertainty caused by the US administration, our outlook remains optimistic. However, we expect increased volatility in the coming weeks. LNG spot rates rise, but the impact remains marginal for most UPI constituents. The market is watching for potential breakouts at key resistance levels, which could determine the next direction of prices.

Our outlook remains steadfastly positive in the long term. The burgeoning demand for LNG, bolstered by situational or management-driven actions and the potential for new long-term contracts, paints a promising picture. Investors should watch policy developments, market competition, and upcoming corporate earnings for further direction.
Source: By Tomas Novotny, UP-Indices.com