Shipping Industry Shifted Toward LNG Amid Green Fuel Scarcity
Operators face supply and infrastructure hurdles as the transition to green methanol stalls.
Updated on Sept. 25, 2026 in Transportation
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Shipowners have increasingly returned to liquified natural gas as global green methanol supplies remain limited and infrastructure gaps persist. The industry faces mounting pressure to meet long-term climate targets while navigating the economic costs of the transition.
Why it matters
The transition to green fuels is constrained by high economic costs and insufficient bunkering infrastructure, leading to delays in international regulatory adoption. Businesses must now prepare for potential financial penalties if they fail to meet decarbonization standards beginning in 2028.
While methanol-powered ships accounted for over 60% of new orders in 2024, widespread adoption is stalled by supply scarcity. Meanwhile, operators utilizing fuel monitoring systems have reported efficiency gains of more than 70%.
The players
International Maritime Organization
The United Nations agency responsible for regulating safety and environmental performance in global shipping.
Malaysia Shipowners' Association
A trade body representing ship operators in Malaysia focused on operational efficiency and regulatory compliance.
The details
Shipowners are pivoting back to liquified natural gas because the bunkering infrastructure required for green methanol is not yet globally accessible. Operators are increasingly relying on fuel monitoring systems to improve efficiency and offset the high costs of alternative energy. International opposition to the pricing model proposed by the IMO has delayed the regulatory framework, creating uncertainty for those planning long-term fleet investments.
Timeline
More than 60 percent of ship orders in 2024 were for methanol-powered vessels.
The Port of Tanjung Pelepas completed its first pilot bunkering operation in 2024.
International Maritime Organization members postponed the adoption of the green framework in 2025.
Malaysia advocated for equitable IMO approaches during a meeting in April 2026.
Ship owners are expected to adopt cleaner fuels by 2028 or face financial penalties.
Market Landscape
The industry's struggle to secure fuel supply highlights the volatility in the global transition toward the IMO Net Zero Framework. This trend mirrors earlier shifts in energy procurement where regulatory goals outpaced the maturity of necessary bunkering infrastructure.
Operators should account for potential fuel cost volatility as the market stabilizes around cleaner options. Management must also prepare for the 2028 deadline when IMO financial penalties may take effect.
The takeaway
The gap between ship orders and available green fuel suggests that operational efficiency remains the most immediate path to cost control. Operators should track the development of the IMO pricing model to assess the risk of penalties by 2028.
Further reading
For more on evolving logistics and infrastructure, visit our Transportation section.
Source note: This article includes information reported by NST Online.
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Should nations prioritize industry affordability when setting mandatory green fuel transition deadlines?
