IMO 2020 – New Fuel Regulations

IMO 2020 – New Fuel Regulations

1 year ago

Click to see surcharges by trade.

On January 1, 2020, the International Maritime Organization (IMO) will impose new emissions standards designed to significantly curb pollution produced by the world’s ships.

Amid a broader push toward cleaner energy markets, the IMO is poised to ban shipping vessels using fuel with a sulfur content higher than 0.5%, compared to the present upper limit level of 3.5%

Effective December 1st 2019 carriers will be implementing these new charges to all quotes under freight terms such as:

  • Low Sulphur Surcharge (LSS)
  • Environmental Fuel Fee (EFF) - IMO 2020 (LSS /EFF)
  • Bunker Adjustment Factor (BAF)
  • IMO 2020 Transition Charge (ITC)
  • New Bunker Factor (NBF)

What does it mean for shipping?

It provides a means to significantly improve air quality caused by shipping.

All these measures represent an additional cost. This cost will be taken into account through the application of fuel surcharges on a trade-by-trade basis. Supply and demand varies by region and availability of low sulphur refining in the initial months, there will be market volatility.