The global LNG shipping sector is on a collision course with climate imperatives and financial stability. This issue brief examines the systemic risks embedded in the industry's rapid expansion and offers strategic recommendations for LNG shipowners, financial institutions, and policymakers.

Key Findings:

• Massive Hidden Emissions: Beyond their direct operational emissions, global LNG carriers enable approximately 12.7 billion metric tonnes of CO₂e annually — a significant climate impact that remains systematically obscured, as the industry does not report the full lifecycle emissions of transported fossil gas.

• Climate Incompatibility: Despite clear scientific evidence against LNG expansion, the industry continues unprecedented fleet growth, with top carriers like Nakilat (Qatar), Mitsui OSK Lines and NYK Lines (Japan), Angelicoussis Group’s Maran Gas (Greece), and Knutsen OAS Shipping (Norway) leading this expansion, creating stranded asset risks.

• Concentrated Financial Control: Just 10 banks control nearly half ($127 billion) of all maritime LNG shipping finance, with institutions like MUFG, Mizuho, and JPMorgan Chase leading.

• Public Finance Contradiction: Government entities actively undermine national and international climate goals, including net-zero pledges and the 1.5°C target outlined in the Paris Agreement, with South Korea alone providing $44.1 billion in LNG carrier financing support over the past decade.

Strategic Recommendations:

• For Shipowners: Disclose enabled emissions and develop fleet transition plans with specific reduction targets

• For Financial Institutions: Set clear phase-out timelines for LNG carrier financing by 2025

• For Public Finance Entities: Terminate support for new construction and develop transition programs

The evidence is unequivocal: Continued investment in LNG shipping directly conflicts with global climate targets while creating immediate financial risks. Early movers in transitioning away from LNG shipping will be best positioned for the emerging low-carbon economy.