Costs Associated with New Environmental Regs Among Top Concerns in Ship Operating Costs Survey

Tightening regulatory requirements is expected to impact vessel operating costs, says Moore Stephens.

Moore Stephens UK (Moore Stephens) says costs associated with meeting tightening regulatory requirements on shipping, such as the International Maritime Organization's (IMO's) 2017 implementation of the Ballast Water Management (BWM) Convention and recent decision to implement a 0.5 percent cap on sulfur content in marine fuel from 2020, was cited as one of the top concerns among respondents to Moore Stephens' "Future Operating Costs Survey 2016."

The BWM convention, which is expected to increase operating costs through technical expenses, will have to be taken into consideration in 2017 drydocking budgets, suggested survey respondents.

"Drydocking costs will increase significantly, depending on the type and size of ship involved," noted a survey respondent.

As Ship & Bunker has previously reported, some analysts believe that tanker rates could get a further boost as tonnage is taken out of service for special surveys or dry docking ahead of the convention's implementation.

New international standards aimed at NOx, SOx, and particulate matter (PM) emissions from ships are also expected to lead to increased operating costs.

"Shipping faces a number of potentially costly compliance responsibilities, including the imposition of an 0.5 percent global cap on sulfur emissions with effect from 2020," said Richard Greiner, Partner in Shipping & Transport at Moore Stephens.

"Other operating issues include predicted increases in the price of fuel, albeit from comparatively low levels, as OPEC looks to reduce oil production levels. This will have a knock-on effect on lube oil costs."

In September, Moore Stephens said shipping confidence during the three months to the end of August rose to 5.4 from 5.1 at the end of May - the second successive quarter of improvement, and the highest level in nine months.