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IMO expects 77% drop in overall sulfur oxide emissions from ships

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Dry Bulk,

From 1 January 2020, fuels used by vessels have been required to contain a maximum sulfur content on 0.5%, down from 3.5%. The International Maritime Organization (IMO) expects that the new limit will mean a 77% drop in overall sufur oxide (SOX) emissions from ships, equivalent to a reduction of approximately 8.5 million tpy of SOX. The RT, which consists of BIMCO, INTERCARGO, the International Chamber of Shipping and INTERTANKO, welcomed the implementation of the regulation which will be good for the environment and the health of coastal populations.

With the introduction of the new limits, initial strong price differentials for various fuel options were observed, with cheaper marine gasoil compared to low-sulfur fuel oils. At the same time, uncertainty remained about the worldwide supply of compliant fuels and concern about the safety and compatibility of fuel options.

Two months after the introduction of the sulfur cap for fuel used by ships, the RT is all cautiously optimistic about the ability of shipowners to adapt to the new regulations. While the industry has barely started its 2020 journey and still needs to build experience with the new fuels, the requirement for ships to use low sulfur fuel has been a change of a magnitude never before attempted on a global scale. Shipowners are playing their part, with the new rules causing genuine concerns over the ability for ships to find compatible fuels. Owners have been working tirelessly to ensure plans are in place to source very low sulphur fuel oil (VLSFO) where needed, and many ships have had to change bunkering ports.

Dimitris Fafalios, Chairperson of INTERCARGO, said: “We cannot forget that we are reliant on cooperation from across the entire supply chain. This includes fuel suppliers to standardise fuel blends, Flag States to report issues to the IMO as appropriate and for Coastal States to properly train their Port State control personnel.”

“Shipowners have been working tireless to comply with the challenging regulation, and we thank them for their commendable efforts. We believe this major change was both timely and needed, however, this does not mean it is without inherent risks. We are determined to address the environmental impacts of shipping so that we can continue to drive global trade sustainably.”

Another point made was that despite announcements regarding how few fuel oil non-availability reports (FONARs) had been issued by Flag States, this did not represent a true measure of the lack of worldwide VLSFO availability since it did not reflect situations where owners had to wait or divert to find fuel. It also failed to reflect the extreme efforts shipowners were making to plan and find compliant fuels at their intended trading ports.

The ‘Round Table’ leaders agreed that continued sharing of experience is paramount and will be reported to IMO as appropriate. Flag States should also be encouraged to improve their reporting to IMO. While shipowners do their part to the best of their ability, all stakeholders should uphold their responsibilities including fuel suppliers, Flag and Port States, as well as charterers.

The four associations have also launched a survey to gain a greater understanding of fuel oil quality and possible safety implications and encourage shipowners and operators to participate.

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Dry bulk shipping market