The International Maritime Organization pushed back this week on any phased entry for tougher marine fuel rules and additional tightened regulations that will come into force in 2020.
Earlier it was proposed by the International Maritime Organization that ships will be prohibited from using fuels with the sulphur content higher than 0.5 % from Jan 1, 2020, compared with 3.5 % these days, unless they’re equipped with alleged scrubbers to clean up sulphur emissions.
Supporting sulphur 2020 implementation – MARPOL amendment adopted by IMO’s Marine Environment Protection Committee (MEPC 73), to prohibit the carriage of non-compliant fuel oil for combustion purposes for propulsion or operation on board a ship. Entry-into-force date 1 March 2020 pic.twitter.com/cNLOsTyfxm
— IMO (@IMOHQ) October 26, 2018
Ships found in breach of the new rules can face fines or the risk of impoundment by IMO member states.
The shipping and oil-refining industries are scrambling to prepare for the shift and have created massive investments to comply with the new standards since they were set in 2016.
Oil companies expect a jump in demand for cleaner distillates, principally diesel, at the expense of fuel oil that would become mostly redundant.
Last week, Washington same it backed a phase-in of the 2020 rules to protect consumers from any value spikes in heating and transportation fuels, although it did not seek a delay.
Some shipping associations along with the Bahamas, Liberia, Panama and the Marshall Islands had proposed an “experience-building phase”, which gained support from Washington, resulting in widespread market speculation in recent days about a possible review of the regulatory timeframe.
A discussion of their proposal in London on at the IMO’s Marine Environment Protection Committee, MEPC 73, failed to advance after the chair of the session said it was too vague.
The paper’s backers were told they could submit more concrete proposals at successive MEPC in may 2019 – especially centred on data collection and fuel oil quality.
That timeframe would, however, leave little time realistically before the regulations kick in for any potential review.
The IMO has reiterated that there’ll be no delay in implementing the rules.
Some analysts including Rapidan Energy group have suggested that major stakeholders together with flag carriers were operating to push back the global sulphur ban.
They additionally suggested that U.S. President Donald Trump’s administration was likely to oppose the 2020 begin date as it would cause a major diesel, distillate and fuel price spike in the winter of a U.S. presidential election year.
“Many saw MEPC 73 as the last chance to delay or soften implementation and the fact that both proposals were rejected strongly suggests that IMO 2020 will enter the market as expected on Jan 1, 2020,” Vienna-based consultancy JBC Energy said in a note on Friday.
The IMO on Friday adopted a ban on ships carrying high-sulphur marine fuel unless they have special equipment on board, further tightening regulations.
This latest amendment, that comes into force on March 1, 2020, makes it illegitimate for ships to hold high-sulphur fuel “for combustion functions, for propulsion or operation on board” while not scrubbers, that wasn’t statute within the main regulation.
REMPEC, the IMO-administered marine pollution emergency response centre in the Mediterranean, has just concluded a study to evaluate the costs and benefits of implementing a SECA in the Mediterranean region. The REMPEC study will be reviewed by a committee of technical experts from Mediterranean countries and the European Union. Further discussion will then take place during a regional workshop at REMPEC’s Malta headquarters in December.
Image Credits: IMO