EMEA News
EU: Bunker Carbon Tax Proposals Could Prompt Higher Exports
Proposals from the European Union (EU) to apply an emissions tax to residual fuel oil could reduce bunkering demand and drive up exports, according to price reporting agency Argus Media.
One proposal is to put a minimum tax on residual fuel oil for bunkering, while another would "fold marine fuel emissions into the EU's Emission Trading Scheme by auctioning 20% of CO2 emissions in 2023" rising to 100% through to 2026.
This proposal would apply to all of the fuel burned on voyages between EU ports and half of the fuel used on voyages between EU and non-EU ports.
Higher prices could see ship operators change routes in response. However, the proposals -- if applied -- would most likely see a drop in demand for fuel oil for bunkering in Europe, and subsequent rise in stocks.
This would prompt "more fuel oil exports" and keep "the arbitrage from northwest Europe to Asia favourable", the report said.
