EXCLUSIVE: Why energy security should drive the maritime fuel transition

The world we live in has become increasingly dangerous, and fuel security is no longer something reserved for climate activists and COP attendees; it’s disrupting daily life, and the industry feeling it the most is the backbone of civil society: Global shipping.

We cannot ignore the fact that when the Iran war caused an immediate standstill in the Strait earlier this year, Brent crude spiked from US$72 to more than US$118 a barrel before retreating once diplomatic progress restored safe passage.

The speed of that swing underscored a broader structural vulnerability: Much of shipping’s fuel supply is still tied to a small number of politically sensitive regions.

As shipping supports 90% of global commerce, disruptions of this scale expose a deeper structural weakness than simple price volatility.

The drive to alternatives

Decarbonisation often dominates the conversation around alternative fuels, but security of supply is becoming just as compelling a driver.

Recent events, whether it be the war in Iran or the European energy crisis triggered by Russia’s invasion of Ukraine, all speak to the same issue – Clean or not, we simply need more accessible fuel that can be produced easily, sourced quickly and made available anywhere.

Methanol is frequently cited in this context, in part because it offers a practical pathway forward. This fuel stays liquid at ambient temperature and pressure and can be bunkered through existing port infrastructure.

Ships can store it onboard in modified tanks and, unlike ammonia, it is relatively nontoxic. Bio-methanol from waste feedstocks can significantly cut well-to-wake emissions. Very Low Sulfur Fuel Oil (VLSFO) and Marine Gas Oil (MGO) remove sulphur almost entirely and qualify under FuelEU Maritime.

The momentum for methanol as a shipping fuel is already evident. Major container lines, including Maersk, CMA CGM, COSCO, Hapag-Lloyd, Wallenius Wilhelmsen and X-Press Feeders, have committed to methanol-capable fleets and currently operate 112 vessels with more than 300 vessels on order.

Evergreen has also allocated several billion dollars to expand its methanol-fuelled capacity. These commitments underscore a strong belief that methanol will play a key role in shipping’s future fuel mix.

Yet progress is uneven and the economics remain challenging.

Green methanol continues to carry a significant cost premium over conventional fossil fuel alternatives, largely due to lower production scales. The average price of green methanol (e- and bio variants) is estimated between €1,193-1,325/ton as production methods mature and scales increase.

For operators, that translates into a significant increase in the overall cost of energy. Drewry Shipping Consultants has calculated that switching a single Asia-Europe container shipment to synthetic green methanol could add over US$1,000 per container in fuel costs alone.

Supply constraints continue to reinforce the issue. Many early projects have faced delays, including in China and global bunkering infrastructure remains in its infancy. Only 48 ports globally currently offer methanol bunkering capabilities compared to 200 ports for LNG.

Overall, there is a mismatch between fleet commitments and fuel availability, leading some operators to rely on alternatives such as LNG as backups.

Every other fuel on the table has its own set of complications.

Ammonia, often labelled as methanol’s rival as a zero-carbon shipping fuel, is attractive on paper because it contains no carbon, but its explosivity and toxicity introduce serious health risks.

The IMO only issued interim safety guidelines for its use in late 2024. Any exposure above 500 parts per million is dangerous, causing blindness or even death and a tank breach following a collision poses serious risks to crew and marine life. Regulators, shipbuilders and insurers are still working through what safe, large-scale adoption could look like.

What the future looks like

These uncertain circumstances indicate that the transition will focus more on managing diversification rather than choosing a single winning fuel. During challenging times, we cannot afford to wait for the perfect solution; instead, we need to invest significantly in infrastructure capable of meeting demand and hope supply can keep pace until any major disruptions are resolved.

While the outlook may seem bleak, there are reasons for cautious optimism.

Research indicates that green methanol production, particularly when linked to offshore wind, could become cost-competitive within the next decade under supportive policy conditions.

And while that trajectory depends on sustained investment and clearer regulatory signals than have been in place so far, recent geopolitical turmoil will hopefully create a sense of urgency among governing bodies to provide clarity for stakeholders across the value chain.

The Hormuz crisis will not be the last shock to hit a fuel supply chain as concentrated as this. It illustrates a broader pattern of geopolitical strain that will continue to reshape energy markets.

For shipping, the lesson is less about short-term price movements and more about long-term exposure to volatile trade routes.

In this context, the energy transition serves a dual purpose: lowering emissions and reducing vulnerability to geopolitical disruption. Emissions will remain a critical benchmark, but resilience may prove the key factor determining how quickly meaningful change occurs.