More stringent marine sulfur limits mean changes for U.S. refiners and ocean vessels
The International Marine Organization’s new regulations limit the sulfur content in marine fuels used by ocean-going vessels in international waters to 0.5% by weight starting in January 2020. This change will have wide-scale repercussions for the shipping industry and refineries in the United States and worldwide.
Globally, marine vessels account for a critical part of the global economy, moving more than 80% of global trade by volume and more than 70% by value. Marine vessels also consume about 4 million b/d of petroleum, 4% of total global oil consumption.
The implementation of new regulations affecting marine fuel specifications will have implications for crude oil and petroleum product markets over the coming decade. Previous Today in Energy articles described these regulations and the short-term implications for refining margins through 2020. Today’s article discusses the longer-term implications of the market changes projected in EIA’s recently released Annual Energy Outlook 2019, as the response to these regulations will likely involve changes to ships, marine fuels, refining, and some infrastructure in the next six to eight years.
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