The usage of renewable energy is projected to increase over the next two decades. In the left chart, renewables (green) is forecast to grow from less than 10% of the share of primary energy to over 40%. Other non-fossil fuels are set to rise as well. However, BP estimates that oil, coal, and gas will all decline.

However, this is likely to be a much more gradual transition in reality, and natural gas is still likely to be prominent given its cost efficiency and availability. From a shipping standpoint, this creates a clear opportunity. Nearly 77% of the LNG carrier fleet is outdated, as 2-stroke, dual-fuel engine technology offers up to 60% improvement in fuel efficiency over legacy assets, per the top right chart. Furthermore, nearly 20% of the LNG carrier fleet is more than 15 years old, and current shipyard production capacity limitations are ~50 LNG carriers per year (<20% of current fleet), per the bottom right chart. This dynamic minimizes the risk of asset over-supply in an environment of strong demand.