New ship orders skyrocketed in the first quarter, and the LNG ship market is experiencing a strong recovery.

The global liquefied natural gas (LNG) shipping market is currently experiencing a deep game between a "strong rebound in orders" and "concerns about excess capacity". In the first quarter of 2026, a total of 35 new LNG carrier (LNGC) construction contracts were signed globally, a significant increase from only 37 for the entire year of 2025, marking the end of a one-year slump in the newbuilding market. After a period of cyclical downturn in 2025, the global LNG shipping construction market is now witnessing a strong recovery in orders. This recovery is not only driven by the physical demand brought about by upstream capacity expansions, but also reflects a profound restructuring of global energy trade routes under the shadow of war. The core logic behind this round of order recovery lies in the triple overlap of upstream capacity expansions, fleet renewal iterations, and shifts in trade patterns. Three factors driving the surge in LNGC orders The strong rebound in LNGC orders in the first quarter of 2026 is not accidental, but a result of the triple overlap of three major structural factors. Firstly, there has been an explosive expansion in upstream liquefaction capacity. According to Wood Mackenzie's global LNG chief analyst Fraser Carson, approximately 72 million tonnes per year of new LNG capacity was approved globally in 2025, with the United States alone set to add over 120 million tonnes per year of LNG supply in the next three to four years. The continued start-up of liquefaction projects in the United States, Africa, Canada, and Argentina will drive the demand for LNGC capacity. Pratiksha Negi, chief analyst of Drewry LNG Shipping, pointed out that the release of upstream capacity, combined with the industry's continued pursuit of fuel efficiency and accelerated pace of scrapping old ships, has collectively contributed to the rebound in orders this time. Furthermore, the rise in US LNG production has brought about a structural shift in trade patterns. The growing US LNG production has led to a shift in the trade model that focuses on "ship-to-ship delivery" and flexible destination changes. Fraser Carson pointed out that this model allows vessels to change course temporarily during the voyage, which, while enhancing trade flexibility, also leads to longer vessel turnaround times and consequently "consumes" more vessel capacity for the same volume. This shift in trade patterns directly stimulates shipowners' expansion ambitionsJapan's largest LNGC owner, Mitsui O.S.K Lines, has explicitly planned to expand its fleet size from the current 107 ships to around 150 ships by around 2035. In addition, the accelerated cycle of scrapping old ships has also boosted demand. LNGCs powered by steam turbines are being phased out rapidly. According to Drewry data, a record-breaking 15 steam turbine ships were scrapped in 2024, with the pace of scrapping accelerating since 2022. The International Maritime Organization's framework for reducing emissions is driving the industry to transition rapidly to LNG dual-fuel-powered vessels, injecting sustained alternative demand for newbuildings. According to Fearnley LNG, four LNGCs built in 2004-2005 were sold for scrapping in the first quarter of 2026, with an average age of just 21-22 years, signaling the establishment of a trend towards "younger scrapping." It is worth noting that as of early 2026, the global LNGC fleet size in operation has exceeded 700 ships, with around 400 ships on order, accounting for about 50% of the existing fleet, which is at a historical high level. The trend of newbuilding prices is another key indicator for judging industry prosperity. The newbuilding price of a 174,000-cubic-meter LNGC peaked at $265 million in February 2025, but has since fallen and has remained around $248 million for several months. However, recent orders indicate a premium for the standard ship type, with HD Hyundai Heavy Industries receiving orders for four 200,000-cubic-meter LNGCs in January 2026 at a price of around $260 million per ship. Uncertainty from Iran conflict: Favorable for longer voyages or conce... (End of segment)