Overview
- The Marine Environment Protection Committee voted to adjourn formal adoption until October 2026 after a Saudi-led motion, with 57 countries in favor, 49 against, and 21 abstentions.
- The U.S. withdrew from talks and warned of tariffs, visa limits, port fees, and sanctions for supporters, a campaign observers said was decisive in blocking adoption.
- The framework pairs a declining fuel‑carbon standard with a pricing system using Surplus Units and Remedial Units for ships over 5,000 GT, with rewards funded through pricing contributions.
- IMO bodies will draft implementation guidelines over the next year, while the EU’s ETS and FuelEU Maritime regimes continue to apply, prolonging a patchwork of regional rules and uncertainty for industry.
- Rystad projects Surplus Units of roughly 40–53 MtCO2e through 2028–2035 versus Tier II Remedial Units rising from about 47 to 234 MtCO2e, likely pushing prices toward the Tier II penalty near $380/tCO2e and generating penalties of about $13 billion in 2028 to nearly $79 billion by 2035, with the fund unlikely to close the zero‑fuel cost gap before around 2030.