The global maritime industry has been facing significant challenges due to regulatory pressure, commercial necessity, and technological innovation. As we enter 2025, liquefied natural gas (LNG) has carved a significant niche in the energy transition for shipping. Once regarded as a bridge fuel, LNG has increasingly solidified its presence, both in terms of fleet adoption and infrastructure expansion. Recent data shows a sharp uptick in LNG-fueled vessel orders, while LNG bunkering operations have reached record highs in major maritime hubs.
After a temporary slowdown in 2023, LNG propulsion orders rebounded dramatically in 2024. According to DNV, the global order book for LNG-fueled vessels surged by an astonishing 103 percent year-on-year, reaching 264 vessels. Data from Clarksons Research indicates that eight percent of all newbuild orders in 2024 opted for LNG propulsion, while alternative fuel vessels collectively accounted for 50 percent of the total orders placed. As a result, the LNG-powered fleet has now grown to 1,248 vessels, representing 84 percent of the overall dual-fueled fleet, which itself constitutes 7.4 percent of the global commercial shipping fleet.
The resurgence of LNG’s adoption coincides with a broader maritime fuel transition. Shipowners, faced with tightening environmental regulations such as the International Maritime Organization’s (IMO) Energy Efficiency Existing Ship Index (EEXI) and the Carbon Intensity Indicator (CII), are seeking pragmatic solutions. The industry’s pivot toward LNG is not just Regulations drive it, but shifting market forces also play a role. With volatile oil prices and an evolving landscape of carbon taxation, LNG offers a cost-effective hedge against both environmental penalties and long-term fuel expenditures.
The record volumes of bunkering operations observed in key ports further underscore the momentum of LNG. Preliminary data for 2024 reveals Singapore, the world’s top bunkering hub, delivered an unprecedented 1,096,807 cubic meters (463,948 metric tonnes) of LNG. Meanwhile, Rotterdam’s figures for the first three quarters of 2024 suggest an annual total exceeding 639,848 cubic meters, a testament to Europe’s growing reliance on LNG.
China, a rising force in the global LNG bunkering market, has made significant strides in boosting its LNG supply chain, particularly in Shanghai. Shanghai Yanshan, a major port for alternative fuels, recorded 444,000 cubic meters of LNG deliveries, followed by Shenzhen Yantian at 300,000 cubic meters and Ningbo Zhoushan at 60,000 cubic meters. The steady expansion of LNG infrastructure across these major trade routes is critical in ensuring the availability and feasibility of LNG as a primary marine fuel.
The Backbone of LNG Adoption
A crucial factor in the LNG propulsion ecosystem is the availability of LNG bunker vessels (LNGBVs), which facilitate ship-to-ship transportation. The LNGBV segment has experienced an exponential rise, reaching 61 units by the end of 2024. Of these, 52 are seagoing vessels, seven are barges, and two are inland units. Impressively, 60 percent of these ships were delivered between 2020 and 2024, reflecting the industry’s rapid adaptation to LNG-based fuel systems.
The geographical spread of LNGBVs provides insight into regional LNG adoption trends. The ARA-Baltic-North Sea corridor has become a significant regional LNG adoption trend. The region serves as the epicenter of LNG bunkering activity, boasting a fleet of 23 vessels that include inland, seagoing, and barge units. The Florida/Caribbean zone follows with nine LNGBVs, while the Singapore/Malacca Strait cluster holds seven. Additionally, Gibraltar and the Western Mediterranean have five vessels actively trading LNG bunker fuel.
The dynamic demand-supply landscape for LNG bunker fuel has evolved. This evolution has resulted in several strategic redeployments within the industry. Among the most significant moves, NYK’s Green Zeebrugge has been repositioned to the UAE under a charter with Monjasa, marking a shift in LNG trading dynamics in the Middle East. Meanwhile, Singapore’s Maritime and Port Authority (MPA) has issued a call for expressions of interest to award an additional LNG bunkering license, signaling anticipated growth in LNG demand in the region.
European players are also making headway. Fratelli Cosulich The company recently took delivery of its second LNGBV, which is currently trading in Malaysia. Additionally, Italy’s Edison has put the Adriatic Sea on the LNG bunkering map by conducting the first ship-to-ship LNG transfer at the port of Trieste. In North America, Seaspan received two of its three ordered LNGBVs from the Nantong CIMC shipyard, one stationed in Vancouver for Pacific Northwest operations, while the other is expected to commence bunkering in Panama by March 2025.
LNG’s growth potential and market dynamics
The cumulative capacity of the current LNGBV fleet stands at 582,912 cubic meters, with a notable concentration in Europe’s ARA/Baltic/North Sea region at 202,408 cubic meters. Florida/Caribbean follows with 94,750 cubic meters, and Singapore/Malacca contributes 76,764 cubic meters. Even regions with a single LNGBV presence, such as the Adriatic Sea, with 30,000 cubic meters, are demonstrating LNG’s expanding footprint in global maritime operations.
Looking ahead, the outlook for LNG as a marine fuel remains largely optimistic. Prices for LNG bunker fuel have eased significantly, with global liquefaction capacity poised to expand further. Despite temporary spikes in European LNG spot prices driven in part by geopolitical tensions, including Ukraine’s pipeline embargo, market fundamentals suggest a prolonged period of relative price stability. New liquefaction projects and gas field developments scheduled for completion through 2026 are expected to maintain a steady supply.
The chartering rates for LNG carriers experienced a temporary decrease in late 2024 and may experience a modest rebound as increased liquefaction capacity tightens the market. Yet, for shipowners evaluating future propulsion choices, the broader macroeconomic indicators favor LNG over conventional marine fuels. Furthermore, early 2025 shipbuilding data shows sustained demand for alternatively fueled tonnage, reinforcing the confidence in LNG’s continued growth trajectory.
Is LNG the Ultimate Transition Fuel?
LNG’s journey in the maritime sector has mirrored the industry’s broader struggle with decarbonization. Critics argue that concerns about methane leakage and long-term carbon neutrality restrict its feasibility. The practical reality is that LNG remains the most commercially viable and widely available alternative fuel today. Hydrogen and ammonia, while promising, still face steep infrastructural and safety-related barriers to widespread adoption. As such, LNG is poised to dominate the transition era, providing shipowners with an immediate compliance pathway while the industry awaits the next-generation zero-carbon fuels.
Record-high bunkering volumes, a rapidly expanding fleet, and widespread LNGBV deployment demonstrate that LNG is not just surviving but thriving. Regardless of its role as a bridge or a long-term solution, LNG is undeniably transforming the shipping industry on a never-before-seen scale, and 2025 could potentially solidify its position as the leading alternative marine fuel of the decade.