About 4 out of every 10 tons of cargo moved by ships is fossil fuel—coal, oil, gas, and petrochemical products. That adds up to roughly 4,500 million tons out of 11,000 million tons shipped globally each year, according to Quartz.

There is an awkward irony buried in this number. Ships move the world's fossil fuels while burning fossil fuels themselves to do it. The two needs feed off each other, and that makes it much harder for the shipping industry to move away from oil than it would be for almost any other type of transportation.

How Much Oil Do Ships Really Use?

International shipping runs almost entirely on oil—over 99% of the energy that powers the global fleet comes from petroleum products, according to the International Energy Agency (IEA). Even though coal, oil, and gas make up only 40% of what ships carry, those heavy materials demand so much energy to transport that fuel cargoes account for roughly half of all the energy shipping uses.

In 2023, cargo ships burned through 4.2 million barrels of oil per day—a 5% increase from the year before, the IEA reports. International shipping produces about 2% of the world's energy-related carbon emissions. That is a small slice of the global total, but shipping is trapped in an industry with almost no way to switch fuels in the near term.

The Problem With Alternatives

Today, alternatives to oil account for almost nothing. Biofuels—fuels made from plants—covered less than 0.5% of shipping's energy needs in 2022. Only about 8% of the world's ships are even built to run on alternative fuels at all, according to the UN Conference on Trade and Development (UNCTAD). That means even the vessels equipped to use alternatives are not actually using them.

The technology options exist: green ammonia, methanol, liquefied natural gas, and hydrogen are all being tested. But each one has serious drawbacks. Some do not store as much energy in the same space as oil does. Others are dangerous to handle. And the supply chains to produce them at the scale shipping would need do not exist yet.

What Would It Take To Change?

The IEA estimates that alternative fuels could grow from less than 1% of shipping's energy today to about 15% by 2030 and 80% by 2050, per a 2023 IEA report. That would mean a dramatic acceleration from where the industry stands now.

Here is where a note about context matters. The 2030 target assumes governments and companies act aggressively to reach net-zero emissions. It is not a prediction of what will actually happen under current policies. The gap between the two tells you where the real challenge lives.

The timing makes the problem harder. Ocean freight volumes are expected to drop about 6% in October 2025 compared to the same month last year, according to a C.H. Robinson freight market update. When shipping volumes shrink, companies make less profit per voyage. When profits fall, operators postpone expensive investments in new ships built for alternative fuels. That is exactly the opposite of what the transition needs.

The Underlying Trap

The shipping industry faces a classic chicken-and-egg problem. Ships are expensive to build and last for 25 years or more. A vessel ordered today will likely still be at sea in 2050. That long lifespan means the entire fleet cannot turn over fast enough to meet climate goals on its own.

At the same time, alternative fuels are expensive and hard to find. Few ports have the infrastructure to refuel a ship with green ammonia or methanol. Shipyards are not yet building many alternative-fuel vessels because companies are not ordering them. Companies are not ordering them because the fuel and the infrastructure do not exist.

This kind of coordination problem has appeared in technology before. In the mid-1980s, personal computers faced a similar stalemate: software companies would not invest in applications because not enough computers were out there, and buyers would not buy computers because there was not enough software. The difference now is that shipping involves governments, energy policy, and far larger amounts of money—which makes the problem much more difficult to break out of.

What Is Actually Changing

The shipping industry is not standing still, though. Governments are beginning to put a price on carbon emissions from ships in ways they did not five years ago. The International Maritime Organization updated its climate targets, and the European Union now includes shipping in its carbon-trading system as of 2024. These changes make burning oil more expensive for shipping companies, which should push them toward alternatives.

Whether the price gets high enough, and whether it happens fast enough to change the investment decisions being made right now in shipyards, will determine whether this transition actually accelerates. That is the question the next few years will answer.