World News
IMO's MEPC Meeting Votes to Approve Decarbonisation Measure
This week's session of the IMO's Marine Environment Protection Committee has voted to approve a new measure on the decarbonisation of shipping.
The policy framework was approved in a plenary vote on Friday, and will be up for adoption at an extraordinary meeting of the MEPC in October.
The measure requires shipping either to start using lower-carbon-intensity fuels from 2028, or to pay penalties for excess emissions.
No levy on all carbon emissions from shipping -- which had originally been envisaged -- was agreed. Instead, a 'base target' and 'direct compliance target' for carbon intensity reductions have been set for each year, starting at 4% and 17% respectively in 2028 and being increased each year after that.
Penalties for emissions above the base target will be $380/mtCO2e, and $100/mtCO2e above the direct compliance target.
Initial reaction to the deal have shown disappointment, with a widespread view that the framework will not be enough to deliver on the IMO's previously stated decarbonisation targets. But the measure will be sufficient to drive a significant and steadily increasing portion of global bunker demand into alternative fuels in the coming years.
A total of 68 member states voted in favour, with 16 countries voting against and 25 abstaining.
"We recognise that this may not be the agreement which all sections of the industry would have preferred, and we are concerned that this may not yet go far enough in providing the necessary certainty," Guy Platten, secretary general of the International Chamber of Shipping, said in an emailed statement.
"But it is a framework which we can build upon.
"We will be studying the technical detail over the coming weeks, and will continue to support the IMO process so that we have a system that also works in company board rooms as well as the governments' negotiating rooms."
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 486.00 | 0.00 | 595.50 | 0.50 |
| Rotterdam | 442.00 | 0.50 | 599.50 | 1.50 |
| Houston | 463.00 | 7.00 | 611.00 | 4.50 |
| Fujairah | 483.00 | 2.50 | 714.00 | 3.50 |
| Global 20 Ports Average | 521.00 | 3.00 | 700.00 | 2.00 |
| Global 4 Ports Average | 468.50 | 2.50 | 630.00 | 1.50 |
| Global Average Bunker Price | 564.00 | 3.00 | 747.50 | 5.50 |
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