{"id":96257,"date":"2025-04-22T00:00:00","date_gmt":"2025-04-22T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/ksa\/2025\/04\/22\/saudi-leads-the-fight-against-new-imo-levy-on-shipping-emissions\/"},"modified":"2025-04-22T00:00:00","modified_gmt":"2025-04-22T00:00:00","slug":"saudi-leads-the-fight-against-new-imo-levy-on-shipping-emissions","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/ksa\/2025\/04\/22\/saudi-leads-the-fight-against-new-imo-levy-on-shipping-emissions\/","title":{"rendered":"Saudi leads the fight against new IMO levy on shipping emissions"},"content":{"rendered":"

<\/strong><\/a> Saudi leads the fight against new IMO levy:<\/strong> A Saudi-led coalition of 15 states is at odds with the UN\u2019s International Maritime Organization\u2019s (IMOs) new two-tier levy on additional shipping emissions, Mees<\/a> reports. GCC states unanimously voted against the decision, indicating they will pull their weight to torpedo the proposed plans ahead of a final vote in October.<\/p>\n

Background:<\/strong> The IMO approved draft amendments to the International Convention for the Prevention of Pollution from Ships (MARPOL) that would force the global shipping industry \u2014 which is responsible for 3% of world\u2019s GHG emissions \u2014 to reduce and pay for a portion of its emissions last week<\/a>. The new rules \u2014 set to be formally adopted this October \u2014 will take effect by 2027 and apply to ships over 5k gross tonnes, covering 85% of international shipping\u2019s emissions.<\/p>\n

How it will work: <\/strong>The draft sets two escalating emissions targets, requiring gradual cuts to ships\u2019 GHG fuel intensity. A stricter standard mandates a 17% cut by 2028 from 2008 levels, increasing to 21% by 2030 and 43% by 2035, the Financial Times<\/a> reported on Friday. Ships that fail to meet this strict target would pay USD 100 per excess tonne of CO2 equivalent.<\/p>\n

The softer target would see cuts by 4% by 2028 and 8% by 2030<\/strong>, increasing to 30% by 2035, but failure to meet this level would result in steeper fees of up to USD 380 per excess tonne. The system also allows for credit trading, with compliant vessels able to sell credits to those that fall short.<\/p>\n

<\/p>\n

The proposed tax is expected to hit GCC countries from two angles<\/strong>, undermining demand for marine fuels derived from oil, and increasing the overall cost of shipping crude oil globally. As it stands, a standard 2 mn barrel of VLCC travelling from the Gulf to China could face charges of USD 1.6 mn in the first year of the tax\u2019s implementation, according to MEES calculations based on Kpler data. <\/p>\n

GCC countries are not happy:<\/strong> The coalition opposed the slightly higher original baseline and \u201c[objected] to the selection of any price per unit of carbon\u201d in a statement to the IMO seen by Mees. The statement indicated that a proposed tax would unproportionally \u201cendanger exports from developing countries,\u201d as it would lead to a hike in global prices for goods shipped by sea. <\/p>\n

What they said:<\/strong> The statement proposes that the system of credits \u2014 as agreed upon in the draft \u2014 remains, rewarding those who exceed IMO targets with credits and penalizing those who do not with \u201cgradual cost increases.\u201d <\/p>\n

MEANWHILE- IMO head Arsenio Dominguez is defending the levies, <\/strong>estimating it c ould<\/a>generate USD 11-13 bn annually<\/a> that would go to a newly proposed net-zero fund aimed at supporting clean fuel adoption, rewarding low-emission ships, and helping developing states upgrade high-emission fleets.<\/p>\n

The GCC isn\u2019t alone:<\/strong> Sixteen countries voted against the draft \u2014 nine of which were from our region, including Iran, Iraq, Jordan, Yemen, Oman, Bahrain, Saudi Arabia, Qatar, and the UAE. The draft was passed with support from 63 countries, including China and Brazil \u2014 which were previously reported in February to formally oppose the levy.<\/p>\n","protected":false},"excerpt":{"rendered":"

A Saudi-led statement to the IMO warned that the new levy could \u201cendanger exports from developing countries.\u201d<\/p>\n","protected":false},"author":1,"featured_media":96258,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3027],"tags":[446,10],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-96257","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-climate","tag-climate","tag-enterpriseam-ksa","wpautop","entry"],"acf":{"mongo_id":"6cd1d10d-b4b0-4de4-b92c-8dcd62b641cb","order":"3","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2025\/3\/1542.jpg","photo_position":"above","homepage_title":"","full_issue_title":"Saudi leads the fight against new IMO levy on shipping emissions","related_issue":[96252],"teaser":"A Saudi-led statement to the IMO warned that the new levy could \u201cendanger exports from developing countries.\u201d","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2025\/4\/.0957d705-6d3c-4167-9a62-e4e0b75e5190.mp3"},"yoast_head":"\nSaudi leads the fight against new IMO levy on shipping emissions - 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