Shipping companies are spending an extra EUR 340 million a day in additional fuel costs as a result of the latest conflict in the Gulf, new T&E analysis shows. As 99 per cent of the global fleet runs on fossil fuels, the industry is directly exposed to fuel price volatility and supply disruptions.
Marine fuel prices are escalating rapidly, with VLSFO reaching EUR 941 per tonne in Singapore, up 223 per cent since the start of 2026. At the same time, LNG prices have risen by 72 per cent since early March. Since February 28, shipping companies have incurred more than EUR 4.6 billion in additional fuel costs.
Efficiency measures, electrification and e-fuels would reduce the industry’s exposure to price fluctuations, says T&E.
‘Crisis should be catalyst for investment in e-fuels’
The rising fuel costs are making alternative fuels increasingly more competitive. T&E’s research shows that the cost gap between marine gas oil – one of the more expensive fossil fuels – and e-fuels has shrunk to near parity (+5 per cent) in some ports (Rotterdam, Fujairah, Houston, Singapore). While the trend may be temporary, it shows that the volatility of fossil fuel markets offsets much of the structural cost disadvantage of clean fuels.
Eloi Nordé, shipping policy officer at T&E: ‘Chaos in the Strait of Hormuz is putting global maritime trade under the spotlight. But it’s on the oil markets where its impact will be felt the most. The war is costing the industry millions every day. Some governments and parts of the industry have spent the last year bashing green maritime measures as being too expensive, yet those costs pale in comparison to this super-disruption. If anything, this crisis should be the catalyst for more investment in European e-fuels and greater uptake of energy efficiency measures to avoid fossil fuel shocks in the future.’
Also read: T&E: ‘Quarter of EU shipping will run on LNG by 2030 locking in fossil fuels for decades’
Local production and fuel saving tech
Unlike fossil fuels which rely on geopolitically exposed routes, e-fuels can be produced locally. Scaling up domestic production will therefore reduce exposure to external shocks and strengthen energy security, says T&E.
‘Ships that can be electrified, like short-sea cargo vessels and ferries, are the low-hanging fruit that would reduce pressure on the fuel market. At the same time, efficiency measures for ocean-going vessels like slow steaming and wind-assistance can deliver huge fuel savings,’ says Nordé.
T&E’s analysis shows that twenty per cent of EU ferries could already be electrified at a lower cost than their fossil equivalents. In addition, deploying modern wind-assist technologies in the form of modern sails can cut fuel consumption for ocean-going vessels by as much as eighteen per cent.
Financial support and targets
T&E calls on European policymakers to accelerate the transition towards a more resilient and competitive maritime industry by supporting the development of a European e-fuels industry through targeted financial support for green e-fuels and strengthened targets in FuelEU Maritime.
Picture (top) by T&E.
Also read: T&E: EU ETS and FuelEU schemes for shipping are full of loopholes
