Very Large Gas Carrier rates on the Persian Gulf to Japan route slid to 14-month lows of under $34/mt this week, after touching one-month highs of near $60/mt a month ago, on an overhang of trader relets and lesser activity in the Middle East LPG market after Saudi Aramco cut term supply for May and June loadings, shipping and trade sources said.

Shipping movements into India have also slowed as there were no new purchase requirements after last month's heavy imports to secure supply ahead of the lockdown, trade sources said.

They added that while the lockdown in India has been extended till end-May, there will be relaxations in some restrictions, which could ease domestic pressure to rush for LPG supply, even as sales in May are down 5% month on month.

"Rates ex AG (have been) falling because of lesser tons in May as Saudi cuts, Indians seems to have taken too much cargoes and have been looking to re-sell," a shipping source said.

"Even though more vessels were ballasting into the US market for June, as the Middle East market for May looked bleak, there are still enough vessels to get what’s out there," the source said. "Also there were some rumors that demand is not really there and with the West/East arbitrage closed, the shipping market is on hold at the moment."

News that Saudi Aramco has announced cancellations and deferments of up to 10 cargoes for June lifting this week, after canceling or deferring up to nine cargoes for May loading, would put more pressure on freight, industry sources said.

Shipping source said that relets and owner-controlled vessels are available through end-May and early-June, allowing charterers to wait for the right time to take up their vessels.

Market sources said that US freight is also looking bearish with relets available over the first 20 days in June, though activity is improving in the West African and Canadian markets.

VLGC rates on the Houston to Japan route was at $73/mt on Tuesday, the lowest since March 26, 2019 when it was $68/mt, S&P Global Platts data showed.