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It says this will put shipping on course for a period of overcapacity and low freight rates, reports London's Loadstar.

Predictions from some carriers that the IMO's new carbon intensity indicator (CII) will result in a 10 per cent decrease in the world fleet are exaggerated, Alphaliner said, suggesting "the real fallout will likely be smaller, and it will only 'creep' into the maritime transport chain, rather than materialize overnight in 2023".

This means container shipping's record orderbook - at 7.4 million TEU, some 30 per cent of the current fleet - will negate any rate increases seen as a result of vessel decommissioning, or CII-related slow-steaming, added Alphaliner. Some 2.32 million TEU of newbuildings will hit the water next year and a further 2.81 million in 2024.

Meanwhile, Alphaliner anticipates "some 5 per cent of vessels" will be inactive by the end of this year as demand declines.

The consultant said quirks of the CII model unduly penalised smaller vessels, as they tend to spend less time in service, thanks to shorter voyages and more time at berth, giving them artificially worse performance statistics than larger ships.

This means large boxships are likely to be cascaded onto trades that call for smaller ones, adding to overcapacity dynamics, as well as artificially inflating CO2 emissions on such trades.

The current CII regime, which has recently drawn major criticism from Maersk, MSC and Hapag-Lloyd, could also incentivize a vessel to "slow-steam in circles rather than wait at anchor" in some cases, said Alphaliner.

Meanwhile, the Covid-related boom cycle, during which vessels were ordered, is winding to a close. With ports returning to pre-pandemic productivity levels, rates normalizing and weak economic indicators in many countries, shipping may be looking at a prolonged period of "structural overcapacity" and weak rates.

This was last seen in the 2010s, when a 6.6 million TEU orderbook, built up pre-2008, was dumped on the post-recession market.

"The orderbook is so large that, despite the various capacity reduction measures, the market will not be able to avoid oversupply for a few years," Drewry's head of container shipping research, Simon Heaney, said..

"We are not expecting EEXI/CII to significantly impact capacity, as ships are already slow-steaming. Other than some ships needing to fix engine power limiters (easily done in a regular port call), there will not be much practical change."

However, Mr Heaney said faster decarbonization could follow as a side-effect of depressed rates.