LNG Storage Off Fujairah Is Equivalent to 3 Months China Demand - BusinessWeek

Liquefied natural gas tankers parked off Fujairah in the United Arab Emirates are storing the equivalent to about three months of China’s average purchases, signaling an oversupply in the market.

About 43 percent of the total capacity of tankers in the Gulf of Oman are holding LNG, Pan EurAsian Enterprises Inc. said in an e-mail yesterday, citing data from Odysseus tracking service. That’s equivalent to about 1.4 million metric tons of the cleaner-burning fuel. China imported 7.63 billion cubic meters, or 5.6 million tons, last year, according to BP Plc’s Statistical Review of World Energy 2010.

An oversupply of gas and weak demand have sent spot charter rates to the cheapest in five years, prompting producers and traders to take advantage of the low charges to store the fuel. Qatar, the world’s biggest producer of LNG, was idling at least eight tankers in the Gulf of Oman as of June 3, according to ship-tracking data from AIS Live Ltd. The vessels have a combined capacity of 1.8 million cubic meters, enough to supply the U.K. for more than a month.