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Smoke on the Water - IMO 2020 Update

May 2020

Turner, Mason & Company

COVID-19 and volatility in the international oil markets drastically reduced the impacts of IMO 2020 and the projected increases in fuel prices and freight rates. This unforeseen drop in petroleum demand from the global pandemic surpassed one of the largest expected disruptions in recent history. While fuel demand in the maritime industry has shifted to predominantly low sulfur fuels, price impacts were not seen. More information and supporting details can be found in the following article. Click for more information.


How COVID-19 Eliminated IMO 2020's Impact on Over-the-Road Diesel Prices

April 2020

Breakthrough

COVID-19 and volatility in the international oil markets drastically reduced the impacts of IMO 2020 and the projected increases in fuel prices and freight rates. This unforeseen drop in petroleum demand from the global pandemic surpassed one of the largest expected disruptions in recent history. While fuel demand in the maritime industry has shifted to predominantly low sulfur fuels, price impacts were not seen. More information and supporting details can be found in the following article. Click for more information.


Shipping sector sets course for zero carbon vessels, fuel by 2030

September 2019

Reuters

The regulation change on January 1st, 2020 will not be the last time the shipping industry is forced to change the status quo for a cleaner alternative. On September 23rd, 2019 major players involved in the shipping industry, including banks, ports, refineries, and shipping companies, kickstarted an initiative to have zero carbon emission marine fuels and ships available and active by 2030. Banks will place emphasis on cutting CO2 emissions when considering loans for shipping companies. Maersk, Trafigura, Citigroup, and other major players have joined together to call for collaboration between all parties to achieve this goal. These efforts will be in addition to the ongoing changes being made by the International Maritime Organizations to reduce greenhouse gas emissions by 50% from 2008 levels by 2050. IMO is expected to release their own plan on increasing fuel efficiency to aid CO2 reductions by 2023.

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Hurdles Persist To Hedging IMO 2020 Fuel Fallout

September 2019

Benzinga – Freight Waves

What options are available to hedge market risks of increased transportation costs due to IMO 2020? How has the market evolved since the initial press release of lowered sulfur limits? Freight waves address these questions and the outlook for several markers in the attached article. The perfect solution does not exist; however, options are available to reduce the risks incurred going into the unknown. Five executives from Euronav give their input on what the market challenges are and how they are mitigating those hazards.

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As IMO 2020 deadline nears, shipping sector makes final push to adapt

August 2019

S&P Global Platts

Platts offers an up to date look on what oil majors and ship owners are doing to prepare themselves for the upcoming regulation change. They also cover how scrubber implementation will effect fuel oil price spreads, what countries are allowing scrubbers to be used in their waters, and the potential spread between the two fuels along with the period it might take the market to rebound. The last sections discuss compliance and collaboration between refiners and ship owners as they will both heavily impact the market on January 1, 2020.

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