|  Christine Marie Nielsen

Near-Term LPG Tank Car Sublease Rates Continue Climb after Further ME2 Delay

Rising short-term tank car lease rates reflect expectations that increased demand for liquefied petroleum gas (LPG) tank cars – prompted largely by the latest halt announcement of the Mariner East (ME2) pipeline project – could persist as long as six months.

Some market participants noted tank car sublease rates as high as $1,000/car/month for three-month contracts this week. Last week, subleases (of three-, six- and 12-months) saw highs of $650/car/month.

“Further bad news on ME2 is supportive,” said one individual at a broker firm, speaking of how another delay of the planned 275,000 b/d natural gas liquids (NGL) pipeline is good for rail shipments of LPG.

The Pennsylvani...

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