LNG Carrier Orders Set to Rebound Amidst Growing Demand and Efficiency Push
Translated from English, summarized and contextualized by DistantNews.
TLDR
- Global orders for liquefied natural gas carriers are expected to rebound this year after a slump, driven by increasing LNG output and demand for fuel-efficient vessels.
- Shipbuilders in South Korea and China have seen a rise in contracts, with 35 new LNGC builds in the first quarter, nearing the total for all of 2025.
- Upcoming LNG production, particularly from the US, and a push for greener shipping are fueling demand for new tankers, though the Iran war introduces some uncertainty.
The global market for liquefied natural gas (LNG) carriers is showing strong signs of recovery, with industry experts anticipating a significant rebound in new vessel orders this year. This surge is primarily fueled by the projected growth in global LNG production and an increasing demand for more fuel-efficient ships, a trend that benefits shipbuilders in key Asian nations like South Korea and China.
The rise in orders is offsetting concerns that supply disruptions from the US-Iran war may reduce near-term shipping demand and pressure freight rates.
The first quarter of the year has already seen a substantial uptick in contracted builds, nearly matching the total for the entirety of the previous year. This renewed activity is a positive indicator for the maritime sector, especially for shipyards that rely on these high-value contracts. Each tanker represents a significant investment, and the sustained order flow suggests a healthy pipeline of work.
Upcoming LNG production in the US, Africa, Canada and Argentina will generate tanker demand, along with a push towards fuel efficiency and accelerated vessel demolitions, said Pratiksha Negi, Drewry's lead analyst for LNG shipping, with steam turbine and diesel-electric carriers expected to be phased out.
Looking ahead, the expansion of LNG production capacity, particularly in the United States, Canada, and Argentina, is expected to further drive demand for specialized carriers. Additionally, a global push towards environmental sustainability in shipping is accelerating the phasing out of older, less efficient vessels and increasing the appeal of newer, dual-fuel options. This regulatory and environmental pressure is a key driver for new builds, as the industry adapts to stricter emissions standards.
The growth of US LNG and flexible LNG supply creates trading patterns that require more shipping.
However, the geopolitical landscape, particularly the ongoing conflict involving Iran, introduces a layer of complexity. While supply disruptions could theoretically increase shipping distances and demand for vessels, they also pose risks to critical transit routes like the Strait of Hormuz. This creates a mixed outlook, where potential increases in shipping demand are tempered by concerns over the stability of global energy flows and the potential impact on freight rates.
The company plans to grow its LNGC fleet to approximately 150 vessels by around 2035.
DistantNews Editorial
Originally published by Asharq Al-Awsat in English. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.
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