A turbulent month for LPG transport as trade tensions stir the market
The VLGC and LPG markets experienced significant volatility throughout April, driven by geopolitical developments and trade tensions.
The month started quietly for the VLGC market, with a stable outlook. However, escalating trade tensions between the United States and China triggered a sharp market correction mid-month, leading to significant volatility and temporarily driving rates down to levels not seen in years.
VLGC recovery underway as tariffs ease
Despite the upheaval, the market demonstrated resilience. By the end of April, VLGC rates had recovered to nearly $40,000 per day on the Houston–Chiba route, following a temporary easing of tariff measures.
As part of regulatory developments, the International Maritime Organization has finalized a landmark climate agreement, setting legally binding targets for the maritime sector to achieve net-zero emissions by 2050. This agreement introduces carbon pricing starting in 2028 and rewards ships that exceed emission targets with tradable credits. For modern and eco-efficient fleets, such as those of EMF and particularly the VLACs, these regulations are clearly beneficial, positioning green vessels competitively as carbon costs are introduced.
Successful Ammonia Bunkering Project in Rotterdam
Regarding ammonia, the Port of Rotterdam successfully completed its first large-scale ammonia bunkering trial. This marks a significant step forward in infrastructure readiness, confirming that ammonia can be safely transferred under operational conditions. As the world's second-largest bunkering hub, Rotterdam's advancements signal a growing momentum towards the commercial viability of ammonia-powered maritime transport and support future prospects for the VLAC segment.
Sources: Clarksons, Port of Rotterdam, IMO