The Oxford Energy Institute has confirmed that liquefied natural gas (LNG) still enjoys a competitive advantage in the maritime transport sector, thanks to its advanced infrastructure and competitive costs that have made it the leading alternative to marine fuels.
CNN quoted the institute as stating that this advantage is diminishing with stricter emission reduction rules. The actual cost of fossil-based LNG is expected to rise from approximately $14 per gigajoule currently to $19 by 2030, $36 in 2036, and reach nearly $98 by 2050.
Shipbuilding Orders
The institute indicated that demand for LNG-powered ships remained strong, with the sector ordering 264 ships powered by this fuel in 2024, before dropping to 188 ships in 2025. These ships accounted for 79% of the total tonnage of new alternative-fuel ships required in 2025, up from 67% in 2024.
Between the beginning of last year and November 2025, LNG-powered ships recorded 157 orders, compared to 47 methanol-powered ships, 19 liquefied petroleum gas (LPG) ships, and five ammonia-powered ships.
Future Costs and Alternatives
The institute pointed out that the cost gap will place shipowners in a long-term investment dilemma, involving either leveraging an existing system or hedging against rising compliance costs. The cost of e-ammonia in 2050 is estimated at around $19 per gigajoule, e-methanol at around $25, and e-methane at around $33.
According to the institute's assumptions, LNG may reach cost parity with e-ammonia around 2032 and 2033, although this timing is not fixed and depends on ship efficiency and methane leakage rates.
Consumption Forecasts
Regarding consumption, the institute expects demand for LNG used in bunkering to rise from 3.7 million tons in 2023 to over 10 million tons by 2027. LNG remains less expensive than the e-fuels included in the model during the current period, after accounting for regulatory penalties.
Source: Syrian Arab News Agency (SANA)
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