F. SCOTT Fitzgerald wrote that the ability to hold two opposing ideas in mind at the same time is the sign of a first-rate intelligence.

By this standard, the shipping industry is very bright indeed.

Many of those shipowners currently investing in dual-fuelled vessels fully accept that LNG’s status as a transitional fuel towards full decarbonisation is at best riddled with problems. At worst, it is “borderline greenwash” as Maersk contentiously described it this week.

And yet, many of these same owners have a genuine commitment to reducing the impact of climate change.

The contradiction lies in confusing commercial strategy with climate policy.

LNG has a vocal support group, not least in the form of the oil supermajors already invested in gas growth as they drill their way past peak oil demand.

Those touting the transitional line of LNG’s reduced emissions, also cite the advantages of an existing gas infrastructure and a body of industry know-how. Not to mention the cargo interests keen to maximise the 20%-plus efficiency gains promised by dual-fuelled options that go some way to burnishing their eco-credentials in the supply chain.

But even before you start examining the studies into methane slip, both upstream and during combustion, and consider the political and financial implications of the World Bank’s anti-LNG stance, the dynamics in such demands remain unbalanced for shipping.

Owners have a 20-year financing view for vessels. Given a decent charter commitment lasting 10 years at best and regularly renegotiated freight contracts all subject to the mutually acknowledged truth that LNG’s longevity as a transitional fuel option is at best limited, and you can begin to understand the hesitancy in the orderbook.

We have already seen some cargo interest publicly state that LNG shipping is not for them, so if the shippers start to shun gas then those triumphant bets on dual-fuelled tonnage quickly start to look less attractive.

Shipowners are hesitant precisely because they know this is a fast-moving policy debate where they risk being caught on the wrong side of a shifting timeline.

And yet there are an increasing number of shipowners exposed to LNG via dual-fuel vessels, either in operation or in the growing orderbooks. LNG is still a relatively small percentage of their respective fleets, but it does make sense for some owners.

Recent fleet moves by the likes of MSC can be read less as climate strategy and more as hedge betting and paying for flexibility to ensure that cargo interests are appeased without having to bet the farm on assets that could yet become stranded.

This is a case of commercial pragmatism, not climate activism.

Those arguing that LNG offers more flexibility to future conversions on ships to run on low-carbon fuels have a point and the methane slip issues are no doubt resolvable in time, with sufficient funds and time.

But time is the scarcest commodity in the industry right now.

The marginal CO2 reduction of LNG compared with feasible conventional fuel designs without the need to invest billions of dollars in infrastructure that locks carbon into the supply chain and slows the transition, is a difficult equation to balance in terms of climate goals.

Maersk’s view that LNG is borderline greenwashing may not be too far off the mark, but its own strategy is built on equally problematic choices. 

The transitional fuels route risks nurturing false hope and extending carbon time lines, but then leapfrogging to as yet unproven technology and the promise of efficiencies yet to come has generated its own fair share of criticism.

The reality is that shipowners have limited agency in determining the speed of shipping’s decarbonisation trajectory.

Getting the commercial strategy right may be a case of choosing between the least worst possible options when it comes to climate strategy.