The report focused on the consequences for shipping markets of a major shift in energy consumption away from hydrocarbons and towards renewables and biofuels.
'Whilst some sectors of the shipping industry, such as containerships, would be virtually unscathed, those for which hydrocarbons comprise a significant proportion of - or all - the cargo mix would undergo decades of falling demand,' MSI director Stuart Nicoll was quoted as saying in a report by London's Tanker Operator.
'The results, detailed in the report, would be multi-decade declines in fleet capacity, earnings and asset prices across the affected sectors. Shipowners would be forced to slash new ordering and scrap uneconomic vessels.'
MSI's shipping market modelling systems enable analysis of how changes in energy demand will affect inter-regional commodity trade flows, and the associated shift in required shipping capacity, industry earnings and asset prices, across all segments of the shipping industry.
The analysis projects two demand frameworks - 'reduction' and 'reference'. Global energy consumption in the 'reduction' scenario is largely based on projections made for pathways consistent with limiting warming to 1.5 degrees Celsius above pre-industrial levels.
The more extreme 'reduction' scenario is the focus of the report, under which fossil fuel demand sees radical decline over the next three decades. By 2050 world coal consumption drops by 80 per cent, oil consumption halves, and gas demand drops by one-quarter.
'The energy transition from fossil fuels to renewables means that investors in shipping and ports are exposed to substantial financial risks, which have not been adequately assessed before,' MSI's oil and tanker markets director Tim Smith added.
'Vessel selection will be critical, and divestment from sectors with the greatest exposure to fossil fuels may prove the only way to profitably navigate the changing landscape.'