LNG Shipping Sector Under Pressure as Nearly 60 Carriers Sit Idle
May 28, 2025 —
The liquefied natural gas (LNG) shipping market is showing clear signs of stress, with nearly 60 LNG carriers currently sitting idle around the globe. According to new data released by Clarksons Research, the world’s leading shipbroker, this marks a stark indication of a downturn in the LNG carrier sector as shifting energy demand and evolving market dynamics take their toll.
This growing idleness comes at a time when LNG carriers—particularly older, less fuel-efficient steam turbine vessels—are increasingly being retired from active service and sent to scrapyards. In the past week alone, four such LNG carriers were sold for demolition, all of them owned by South Korean firms, long known for their dominance in LNG shipping.
The four vessels—Hyundai Aquapia, Hyundai Technopia, HL Ras Laffan, and HL Sur—were all built around the year 2000 and powered by traditional steam turbines, which are now considered obsolete compared to modern dual-fuel and ME-GI engine technologies. These outdated propulsion systems have made them uneconomical to operate in the current market, especially amid high fuel costs and stricter emissions regulations.
All four ships were sold for scrap at a competitive price of approximately $565 per light displacement ton (ldt). Each vessel fetched an estimated $19.2 million, with deals arranged for en bloc recycling. The transactions underscore the growing urgency among owners to shed aging tonnage that no longer meets the operational or financial demands of the modern LNG trade.
The move highlights a broader trend taking shape across the LNG shipping industry, where oversupply and weaker-than-expected global demand have combined to squeeze profits. The number of idle ships—nearly 60, according to Clarksons—represents a significant portion of the global LNG fleet and reflects a slowdown in seaborne gas trade.
Much of the oversupply stems from a mismatch between anticipated growth in LNG demand and reality. In recent years, shipowners rushed to commission dozens of new LNG carriers amid forecasts of booming LNG consumption in Asia and Europe. However, those projections have been tempered by a combination of mild winters, increased competition from renewable energy sources, and improved energy storage and efficiency measures across key importing nations.
At the same time, the market is also grappling with regional disparities in LNG pricing, which have dampened arbitrage opportunities that once made long-haul shipping highly profitable. With Asian LNG spot prices showing little volatility and European inventories remaining well-stocked, fewer cargoes are making intercontinental journeys—leaving ships without charters.
For South Korean owners in particular, the pressure to offload aging assets is rising. Companies such as Hyundai LNG Shipping and Hyundai Merchant Marine are leading the way in fleet renewal, replacing steam-powered vessels with newer models that meet IMO Tier III emission standards and offer greater fuel efficiency. These strategic retirements not only help owners cut operating costs but also reflect a broader shift toward environmental compliance and digital optimization in shipping.
Despite the current lull, some analysts see the sector’s long-term prospects remaining intact. “The LNG market is cyclical, and while we’re clearly in a down phase, global decarbonization trends still point toward LNG playing a role in the energy transition,” said one senior maritime analyst at Clarksons. “But to stay viable, fleets must adapt—both technologically and commercially.”
As more older ships head for the scrapyards and newbuilding orders slow in response to the current oversupply, the market may eventually rebalance. For now, though, the sight of dozens of idle LNG carriers anchored off global coasts stands as a striking reminder of the sector’s present challenges and uncertain short-term future.
