LPG Shipping (BUY): Trump’s Total Trade War (27-page report)
With an escalating trade war between the US and China seemingly gathering momentum, we estimate VLGCs to be one of the hardest hit shipping sectors (excl. containers). The US-Sino trade constitutes ~8% of the global VLGC demand, but we find the picture to be much less gloomy than first perceived. We estimate a potential net impact of only -1.9% if China halts US LPG imports, with a -1.7%p impact on fleet utilization. We reiterate our BUY on LPG Carriers but expect trade war to continue casting shadows over share prices in the short term.