After nearly a decade of talks, countries have struck a global deal that would mandate the shipping sector to curb emissions, covering most of the world’s commercial fleet. Starting in 2028, shipowners must adopt cleaner fuels or face fines of up to $380 per ton of CO2 emitted.
The agreement, passed Friday at the UN’s International Maritime Organization (IMO), survived last-minute drama after Saudi Arabia demanded a vote and the US exited negotiations.
Small island nations and environmental groups criticized the outcome, arguing that the lack of a global carbon tax made the deal “unfit for purpose.”
Shipping accounts for roughly 3% of global emissions but has been slow to shift from fossil fuels. With this deal, it becomes the first industry to face internationally mandated emissions targets.
Despite opposition from oil-producing countries like Saudi Arabia and Russia, all IMO members must comply. The vote — rare in UN processes that typically rely on consensus — highlighted the agreement’s divisiveness.
While ship efficiency has improved, overall emissions have risen alongside global trade, 90% of which moves by sea. Transitioning to green fuels is seen as key but remains costly.
“There is no fuel as cheap as diesel that ships use today,” said Faig Abbasov of Transport and Environment. Diesel is a residual product of crude oil refining, requiring minimal processing.
In contrast, cleaner fuels like e-kerosene and ammonia require complex production processes, such as splitting water molecules to extract hydrogen—a highly energy-intensive and costly method.
Depending on the type of alternative fuel, production costs can be three to four times higher than conventional marine fuels, according to estimates from the World Economic Forum.
Nonetheless, consultancy group UMAS projects that the new IMO agreement could lead to an 8% reduction in shipping emissions by 2030.
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