IMO Regulations to reduce sulphur oxide emissions from ships first came into force in 2005,under Annex V1 of the International Convention for the Prevention of Pollution from Ships ( known as the MARPOL Convention). Since then the limits on sulphur dioxide have been progressively tightened.
The current limit for Sulphur Content is 3.5%. In October 2016, IMO decided that the new reduced limit of 0.5% shall apply from 1st January 2020.
The current main type of “ Bunker” oil for ships is heavy fuel oil, derived as a residue from crude oil distillation. This crude oil contains high levels of sulphur which, following combustion ends up in ship emissions.
To comply with this new Worldwide legislation the shipping companies will have to commence the switch to low sulphur fuel in late November / early December. This switch to low sulphur fuel will significantly increase fuel costs which the shipping companies will pass on in the form of a fuel surcharge. These charges will be published by the shipping companies in due course.
This change will significantly affect shipping costs, at this stage as demand for the fuel is low, exchange rates unpredictable and with worldwide fuel prices volatile it is difficult to estimate an exact price. With that said some predictions are that the low sulphur surcharge could add as much as £40 per trailer and £25 on the short sea crossings (Cairnryan).
Please see the IMO and ferry company links below for more information on the fuel cost increase.