A recent report by researchers at University College London and the Kuhne Foundation suggests that the tanker and gas carrier industries could face a significant decline in profits over the next 25 years if the global economy meets the Paris climate targets. The study predicts a potential loss of up to $200 billion in profits for these sectors, even if all newbuild orders cease. This would represent a third of the profits that tanker companies could expect under a business-as-usual scenario.
The research focused on analyzing the ownership structure, asset value, and transport capacity of the global tanker fleet under different climate scenarios. The findings indicate that LNG, LPG, and crude tankers may experience oversupply in the future if global fuel consumption decreases in line with the Paris Agreement’s goals. This could result in a cumulative loss of profits amounting to $214 billion by 2050, with the potential for further losses if new vessels continue to be ordered and built.
The decline in tanker activity could lead to a reduction in cumulative CO2 emissions from the maritime industry by 1.3-2.0 billion tonnes by 2050, aligning with the industry’s carbon budget for a 1.5-degree Celsius trajectory. The report also highlights the potential for vessels to adapt to a changing energy market by switching cargoes or converting to new liquid fuels. Researchers emphasize the importance of evaluating climate risks and redirecting investments towards sectors that support the transition to a low-carbon society.
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