The shipping industry is facing a challenging period as it navigates the complexities of new regional emissions regulations from the European Union, specifically FuelEU Maritime. Simultaneously, the sector is closely monitoring the ongoing discussions regarding forthcoming global regulations from the International Maritime Organization (IMO). This highlights the dual pressure of regional and global environmental mandates on the shipping industry, reports Baltic Exchange.
Uncertainty around Regulation
During the Baltic Exchange Tanker & Gas Market Insight Forum at IE week 2025, experts discussed the complexities and uncertainties surrounding the EU’s FuelEU Maritime regulation and the IMO’s emissions legislation.
Martin Crawford-Brunt, CEO of Lookout Maritime and emissions lead at the Baltic Exchange, voiced concerns about the current regulatory approach. He expressed a lack of confidence in regulators’ ability to create a level playing field, citing their tendency to introduce flawed regulations with promises of future fixes.
Crawford-Brunt criticized the reality of varying pressures across different shipping sectors and segments, undermining the idea of uniform costs.
He advocated for a market-driven solution, proposing a system where emissions are calculated based on “round voyage, global greenhouse gas equivalent for every unit of cargo discharged.” He suggested benchmarking these emissions against Baltic standards to translate them into dollars per tonne or time charter equivalent.
Starting From Scratch
Edwin Pang, founder and director at Arcsilea, emphasized that emissions regulations for shipping are a new and evolving process. He acknowledged that initial implementations are likely to have imperfections.
Pang highlighted the importance of incentivizing the demand and production of alternative fuels, explaining that fines under the EU’s FuelEU regulations are designed to bridge the cost difference between green and traditional fuels.
He also pointed out the complexity of implementing such regulations globally, noting the extensive number of guidelines required to make IMO emissions regulations functional.
Philip Roche, partner at Norton Rose Fulbright LLP, reinforced the inherent difficulties in decarbonizing the shipping industry.
Fuel Certification
Edwin Pang highlighted a critical issue: the absence of an international fuel certification scheme within the IMO. He stressed that creating such a scheme is essential, as without it, there’s no way to guarantee the quality and recognition of fuels purchased from various global suppliers. He predicted this lack of a standard will likely lead to numerous disputes.
Pang defended the EU’s decision to implement FuelEU ahead of global regulations, arguing that the EU’s structure allows for more detailed and in-depth discussions compared to the IMO. He pointed out that the EU, with its 27 member states, has dedicated more time to analyzing and refining the regulations. He suggested that the EU’s experience can inform and improve the IMO’s regulatory process.
The panel also addressed the challenge shipowners face in ordering vessels today, considering the long lifespan of these ships (20-25 years) and the uncertainty surrounding future emissions regulations.
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Source: Baltic Exchange
