- US Opposition and Geopolitical Divisions Stall Decarbonization Talks.
- Supporters Warn Delay Creates Uncertainty for Shipping and Fuel Markets.
- EU and Pacific Nations Continue Backing Framework Despite Adjournment.
On October 17, member states of the International Maritime Organisation (IMO) made the decision to delay discussions on new decarbonization rules for marine fuels by a year. This move came in response to significant pushback from the United States. During a special session of the IMO’s Marine Environment Protection Committee, 57 countries backed Saudi Arabia’s proposal to pause the talks, while 49 were against it, and 21 chose to abstain. To adjourn, a simple majority of 54 votes was needed, reports S&P Global.
Impact on Net-Zero Framework Timeline
The IMO’s Net-Zero Framework aimed to impose a cost on greenhouse gas emissions from bunker fuels starting in 2028. This delay has cast doubt on both the timeline and the regulation itself. Some advocates voiced worries that this postponement could lead to extended uncertainty for shipping companies regarding their fuel options and the bunker markets. A delegate from Brazil, a supporter of the framework, remarked that this delay could be seen as a “rejection,” since parts of the text, including timing provisions, would need to be renegotiated extensively.
“We are disappointed that member states have not been able to agree a way forward at this meeting,” said Thomas Kazakos, secretary general of International Chamber of Shipping, whose members represent national shipowners controlling 80% of the world’s merchant fleet. “Industry needs clarity to be able to make the investments needed to decarbonise the maritime sector.”
Opposition from the United States
The US has consistently opposed the framework. On October 16, former President Donald Trump called it a “global carbon tax” regime for shipping that would increase inflation. “The United States will NOT stand for this Global Green New Scam Tax on Shipping, and will not adhere to it in any way, shape, or form,” Trump said on Truth Social.
Earlier, on October 10, US Secretaries of State, Energy, and Transportation issued a joint statement rejecting the proposal, warning of possible retaliatory measures such as increased port fees, sanctions, or blocking vessels from accessing US ports and LNG terminals. “Radical climate activists have been intimidating countries into propping up the Green New Scam for years — this global Carbon Tax was their latest bullying tactic that President Trump made clear the United States would not adhere to in any form or fashion,” White House spokesperson Taylor Rogers said.
Supporters Highlight Potential Benefits
Despite higher costs of sustainable marine fuels compared with conventional fuels, some industry players see potential for the framework to boost green fuel production.
“The Net-Zero Framework is an enormous potential market opportunity for American-made renewable fuels,” said Geoff Cooper, President and CEO of the Renewable Fuels Association.
Voting Dynamics and Geopolitical Divisions
Saudi Arabia, along with other fossil fuel producers, took the lead in opposing the adoption of the framework by the IMO, arguing that it couldn’t move forward as “a divided house.” This motion to adjourn found support from China, India, Panama, and several others, while Japan, Greece, and Cyprus chose to abstain. Some Pacific island nations voiced their support, emphasising that it was a step forward, even if the decarbonization impact was limited, rather than sticking with the current situation. “This [delay] is unacceptable given the urgency we face in light of accelerating climate change,” said Vanuatu’s Minister for Climate Change Ralph Regenvanu.
Most EU member states continue to back the framework, with the European Commission stating it will “engage constructively with all partners” despite the delay.
Market and Future Outlook
Observers are cautious about the framework’s prospects. “Momentum appears to be fading, agreeing increasingly difficult,” said ING economist Rico Luman. IMO Secretary-General Arsenio Dominguez emphasised the challenges posed by geopolitics but noted ongoing cooperation: “What I am aiming is to continue the cooperation among the member states. Geopolitics right now make it more difficult for us to address certain challenges.”
Discussions on the framework’s technical details will continue during the Intersessional Working Group on Reduction of GHG from Ships from October 20-24, which could influence bunker markets if the regulation is eventually adopted.
