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Marine Sector to Reduce Sulphur Emissions

Sep 26. 2019

As part of the global movement to raise awareness of, and to tackle the issues associated with environmental damage and the impact of fuel emissions; the marine sector has issued new regulations. These are the largest, single regulation in transportation fuel ever undertaken and will come into effect 1st January 2020.

Next year will see the International Maritime Organization (IMO) put a limit on sulphur emissions for the marine sector in international waters. The new regulation will mean that the sector must reduce sulphur emissions by over 80%. This will be achieved by either switching to lower sulphur fuels or by installing scrubbers. This is an important step as, essentially, limiting sulphur oxides emissions from ships reduces air pollution and results in a cleaner environment. The main type of “bunker” oil for ships is heavy fuel oil, which is derived as a residue from crude oil distillation. It is the crude oil which contains sulphur and after combustion in the engine, ends up in ship emissions.

Half of the global fuel oil demand is from the marine sector; consuming approximately 3.8M barrels of fuel per day. The regulation will force ship operators to switch to a different fuel type and in doing so will compete with truck operators, rail operators and airlines.
The increased demand for the IMO compliant fuel will most likely increase the costs and it is anticipated that this will cause ocean freight rates to increase.

It is of course not just international relocation companies that depend on the marine industry, shipping also responds to the demands of world trade and as world trade increases, more ship capacity will be needed.

Further information on the new regulation and what this will mean can be found here on the International Marine Organization website

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