CASE STUDIES / RISK · NOV 2024
Mexican supply is worth $83M when canals close.
A resilience test comparing a US-Gulf-only book against one diversified with Mexican Pacific supply, under open and closed Suez and Panama canals.
+$83.1M
THE MEXICO ADVANTAGE WITH SUEZ AND PANAMA CLOSED
Two books, same demand.
01 · THE SETUP
Both portfolios serve Gate and Futtsu with 80 cargoes on seven 174K vessels through 2025. One sources everything from Sabine Pass; the other swaps twenty cargoes to Costa Azul on Mexico's Pacific coast.
BOOK 1 · US GULF ONLY
- 80 cargoes from Sabine Pass
- 115% HH + $3.5 tolling fee
- Everything crosses Panama or Suez to reach Asia
BOOK 2 · US GULF + MEXICO
- 60 cargoes from Sabine Pass, same terms
- 20 cargoes from Costa Azul, 120% HH + $3 tolling
- The Pacific coast reaches Asia without any canal
DEMAND: GATE SPOT AT 90% TTF MINUS $0.50 REGAS · FUTTSU SPOT AT 90% JKM · CANALS MODELLED FULLY OPEN OR FULLY CLOSED · FORWARD CURVES HH, TTF AND JKM
More in every state, safer in the bad one.
02 · THE STRESS
The diversified book earns more in every state, and loses far less when both canals shut, because Costa Azul reaches Asia without touching Panama.
US GULF ONLY
$1,013.4M
CANALS OPEN · FULL-YEAR P&L
US GULF + MEXICO
$1,088.2M
CANALS OPEN · FULL-YEAR P&L
EXACT ENGINE RESULTS: OPEN $1,013,418,557 → $1,088,249,229 · CLOSED $992,984,431 → $1,076,062,599
The drawdown gap.
03 · RESILIENCE
A double canal closure costs the US-only book over twenty million dollars; the diversified book gives up twelve. And the Mexican cargoes add value before any crisis: the uplift exists in the open state too.
-$20.4M
US-ONLY CLOSURE HIT
-$12.2M
DIVERSIFIED CLOSURE HIT
+$74.8M
MEXICO UPLIFT · CANALS OPEN
+$83.1M
MEXICO UPLIFT · CANALS CLOSED
04 · THE VERDICT
Pacific supply raises P&L in every state:
the closure hit nearly halves.
Diversification here is not an insurance premium, it pays before any crisis. Twenty Costa Azul cargoes lift the book by $74.8M with canals open, $83.1M with them closed, and cut the drawdown from $20.4M to $12.2M.
Asia stays served through the Pacific.
05 · THE FLOWS
When the canals close, the US-only book retreats to Europe almost entirely. The diversified book keeps twenty cargoes flowing to Futtsu, all of them from Costa Azul, while Sabine Pass backfills Europe.
US only: Asia is abandoned
Under closure the book retreats to Europe almost entirely: 78 cargoes to Gate, just 2 reach Futtsu the long way.
With Mexico: 20 cargoes keep flowing east
All twenty Costa Azul cargoes reach Futtsu without touching a canal, while Sabine Pass backfills Europe with 60.
Open state, same pattern
70 Gate and 10 Futtsu from the US-only book against 57 Gate and 23 Futtsu when Costa Azul is in the mix.
Straight from the engine.
06 · ENGINE OUTPUT
The re-optimised routes under a double closure: the US-only book sails to Futtsu the long way, the diversified book crosses the Pacific.
What Pacific supply buys, and what it does not.
07 · TAKEAWAYS
Mexico pays before any crisis
+$74.8M with canals open: the diversified book earns more in every state, not just the stressed one.
The closure hit nearly halves
-$12.2M against -$20.4M under a double closure, because Costa Azul reaches Asia without touching Panama.
The US-only book concentrates canal risk
Under closure it retreats to Europe almost entirely; Asian demand is served by just two long-way cargoes.
Modelled with X-LNG.
08 · THE TOOL
Your world goes in
Contracts, vessels, charter rates, prices, spot assumptions and constraints. The full book, not a slice.
One optimal plan comes out
Feasible, P&L-maximising and constraint-compliant, re-solved for every scenario in minutes.
Every number checks out
Each result can be recalculated by hand. Transparency your risk committee can audit.
CLOUD-BASED, ANY PORTFOLIO SIZE · BUILT AND ADVANCED DAILY BY ~25 MATHEMATICIANS, PHYSICISTS AND COMPUTER SCIENTISTS