John Mayes and John Auers at Turner, Mason & Company examine what is next for the industry following the 2020 deadline set by the IMO for low sulfur bunker fuel
In October 2016, the International Maritime Organization (IMO) definitively set the transition date for the introduction of low sulfur bunker fuel to January 1, 2020. This action ended years of debate as to when the new regulations would take effect and has helped to galvanise attention on how the lower sulfur bunker fuel will be produced and the likely market effects which will result.
The IMO is an agency of the United Nations and has been given jurisdiction by the UN over environmental and safety issues in international waters. It is currently comprised of 172 member states. In 2005, the IMO developed its Annex VI requirements, which set a maximum sulfur limit for bunker fuel at 4.5%. This limit was reduced to 3.5% in January of 2012.
The Annex VI regulations also required a further reduction to 0.5% in J...