Oct. 25 (UPI) — A queue of vessels loaded with a super-cooled liquid form of natural gas is building up offshore in Europe as regional infrastructure becomes saturated, vessel tracking data show.
U.S. news outlet CNBC relied on data from the online service MarineTraffic to identify 60 vessels laden with liquefied natural gas sitting more or less idled near the ports of Northwest Europe, the Straits of Gibraltar and in the Mediterranean Sea.
Andrew Lipow, the president of Lipow Oil Associates, told the news outlet on Tuesday that the long queues indicate more LNG is coming in than regional facilities can handle.
“The wave of LNG tankers has overwhelmed the ability of the European regasification facilities to unload the cargoes in a timely manner,” he said.
The European market is leaning more on LNG as it tries to break Russia’s grip on the regional energy sector not only for the sake of energy security but also as part of an effort to stifle the Kremlin’s war chest as it continues to press its campaign in Ukraine.
That leaves it to countries such as Australia, Qatar and the United States to deliver supplies. German energy company RWE signed a new agreement to secure shipments of LNG from Qatar just last month.
LNG does not carry the same geopolitical risk that conventional pipelines do because delivery options are more fluid, but long voyages and the lack of infrastructure to warm LNG back to the gaseous form are creating some challenges for Europe nonetheless.
Should those vessels sit around for too much longer, they could be rescheduled for other ports. Given European concerns about the availability of natural gas during the winter, however, the build-up of ships offshore could provide a sense of security given the amount of product waiting to come onshore.
The build-up too may be good for natural gas prices as it addresses some of the looming supply-side challenges. Ade Allen, an analyst at Norwegian consultant group Rystad Energy, said that, all told, the situation in Europe seems to be improving.
“LNG demand in Europe remains high, but market pressures have eased with improvements in storage inventories within the region,” he said.
