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Divisions continue to delay IMO GHG strategy

  • : Biofuels, Emissions, Oil products
  • 23/07/03

The International Maritime Organisation (IMO) began the 80th meeting of the Marine Environment Protection Committee (MEPC 80) in London today, with member states deeply divided on emissions.

The end of this week, 7 July, is the deadline for adoption of the IMO's revised greenhouse gas (GHG) strategy. Member states must agree on a timeline for reducing GHG emissions and the amount by which to reduce them from 2008 levels.

IMO secretary general Kitack Lim said these discussions had "reached the final stage" following five years of negotiations. Most members agree there should be a target for 2050, and intermediary ones for 2030 and 2040, but there is no coherence on implementation, leniency, nor if these targets should be met around or by these dates.

Australia professed disappointment in what it felt to be the inadequate targets being proposed, calling for full decarbonisation of the shipping industry by 2050 at the latest. This echoed comments from Pacific Islands states, such as Kiribas and the Marshall Islands, which insisted on maintaining the 1.5C temperature rise stipulated in the Paris Agreement. The Netherlands and Sweden pushed for a net zero target.

Others urged the need for practicality and the protection of the shipping industry. China and India painted more ambitious targets as attempts to restrain their economic growth. Brazil argued that developed countries — responsible historically for climate change — were seeking to raise funds, which they had promised to developing countries to support them, through IMO to avoid making reparations.

Venezuela and Argentina opposed decarbonisation and a maritime tax as unfairly burdening countries with distant markets and lower-value goods. They said the shipping industry is disproportionately targeted.

There was much discussion around the effects of any adopted measures on developing states, which are more vulnerable to climate change's consequences and have less funds to sustain a path to lower emissions. A common refrain during the meeting was "a fair, equitable and just transition."

Decisions taken at IMO levels are legally-binding for governments accepting the IMO's convention. The revision of the strategy could have far-reaching consequences for the shipping industry. The IMO's initial strategy on GHG emissions in 2018 set targets for the carbon intensity of shipping to decline by at least 40pc by 2030 and 70pc by 2050 compared with 2008 levels. Members also agreed to reduce overall GHG emissions by at least 50pc by 2050.

How far away is a consensus

Secretary general Lim was optimistic on consensus being reached by deadline, but lack of progress in intersessional meetings puts this into question. Lim said progress had been made in reaching a consensus for the GHG strategy during the intersessional working group (ISWG) last week, but in fact only guidelines on the lifecycle GHG intensity of marine fuels (LCA) were drafted.

Asked if a charge on CO2 emissions could be guaranteed, Lim said the MEPC draft had adopted it as part of its basket of measures, but that its modality had not been agree upon. But a report on the outcome of ISWG-GHG 14 and 15 said consensus could not be reached on economic measures, or on methodology for the impact assessment of the strategy on individual states.

A United Nations Framework Convention on Climate Change (UNFCCC) report concluded that more needed to be done urgently by IMO to reach its decarbonisation targets. Any measure decided this week will have its implementation discussed, probably for a couple of years, and then a further two years would be necessary to put them into actions. There are limits to the IMO's ability to enforce any of its regulations. If a consensus is not found, the committee cannot call for a majority vote, only the member states can.

The GHG working group has not been released at time of publication.


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25/06/13

EPA proposes record US biofuel mandates: Update

EPA proposes record US biofuel mandates: Update

Updates with new pricing, reactions throughout. New York, 13 June (Argus) — President Donald Trump's administration today proposed requiring record biofuel blending into the US fuel supply over the next two years, including unexpectedly strong quotas for biomass-based diesel. The US Environmental Protection Agency (EPA) proposal, which still must be finalized, projects oil refiners will need to blend 5.61bn USG of biomass-based diesel to comply with requirements in 2026 and 5.86bn USG in 2027. Those estimates — while uncertain — would be a 67pc increase in 2026 and a 75pc increase in 2027 from this year's 3.35bn USG requirement, above what most industry groups had sought. The proposal alone is likely to boost biofuel production, which has been down to start the year as biorefineries have struggled to grapple with uncertainty about future blend mandates, the halting rollout of a new clean fuel tax credit, and higher import tariffs. The National Oilseed Processors Association said hiking the biomass-based diesel mandate to the proposed levels would bring "idled capacity back online" and spur "additional investments" in the biofuel supply chain. The EPA proposal also would halve Renewable Identification Number (RIN) credits generated from foreign biofuels and biofuels produced from foreign feedstocks, a major change that could increase US crop demand and hurt renewable diesel plants that source many of their inputs from abroad. US farm groups have lamented refiners' rising use of Chinese used cooking oil and Brazilian tallow to make renewable diesel, and EPA's proposal if finalized would sharply reduce the incentive to do so. Biofuel imports from producers with major refineries abroad, notably including Neste, would also be far less attractive. The proposal asks for comment, however, on a less restrictive policy that would only treat fuels and feedstocks from "a subset of countries" differently. And EPA still expects a substantial role for imported product regardless, estimating in a regulatory impact analysis that domestic fuels from domestic feedstocks will make up about 62pc of biomass-based diesel supply next year. The Renewable Fuel Standard program requires US oil refiners and importers to blend biofuels into the conventional fuel supply or buy credits from those who do. One USG of corn ethanol generates one RIN, but more energy-dense fuels like renewable diesel can earn more. In total, the rule would require 24.02bn RINs to be retired next year and 24.46bn RINs in 2027. That includes a specific 7.12bn RIN mandate for biomass-based diesel in 2026 and 7.5bn in 2027, and an implied mandate for corn ethanol flat from prior years at 15bn RINs. EPA currently sets biomass-based diesel mandates in physical gallons but is proposing a change to align with how targets for other program categories work. US soybean oil futures surged following the release of the EPA proposal, closing at their highest price in more than four weeks, and RIN credits rallied similarly on bullish expectations for higher biofuel demand and domestic feedstock prices. D4 biomass-diesel credits traded as high as 117.75¢/RIN, up from a 102.5¢/RIN settle on Thursday, while D6 conventional credits traded as high as 110¢/RIN. Bids for both retreated later in the session while prices still closed the day higher. Proposed targets are less aspirational for the cellulosic biofuel category, where biogas generates most credits. EPA proposes lowering the 2025 mandate to 1.19bn RINs, down from from 1.38bn RINs previously required, with 2026 and 2027 targets proposed at 1.30bn RINs and 1.36bn RINs, respectively. In a separate final rule today, EPA cut the 2024 cellulosic mandate to 1.01bn RINs from 1.09bn previously required, a smaller cut than initially proposed, and made available special "waiver" credits refiners can purchase at a fixed price to comply. Small refinery exemptions The proposal includes little clarity on EPA's future policy around program exemptions, which small refiners can request if they claim blend mandates will cause them disproportionate economic hardship. EPA predicted Friday that exemptions for the 2026 and 2027 compliance years could total anywhere from zero to 18bn USG of gasoline and diesel and provided no clues as to how it will weigh whether individual refiners, if any, deserve program waivers. The rule does suggest EPA plans to continue a policy from past administrations of estimating future exempted volumes when calculating the percentage of biofuels individual refiners must blend in the future, which would effectively require those with obligations to shoulder more of the burden to meet high-level 2026 and 2027 targets. Notably though, the proposal says little about how EPA is weighing a backlog of more than a hundred requests for exemptions stretching from 2016 to 2025. An industry official briefed on Friday ahead of the rule's release said Trump administration officials were "coy" about their plans for the backlog. Many of these refiners had already submitted RINs to comply with old mandates and could push for some type of compensation if granted retroactive waivers, making this part of the program especially hard to implement. And EPA would invite even more legal scrutiny if it agreed to biofuel groups' lobbying to "reallocate" newly exempted volumes from many years prior into future standards. EPA said it plans to "communicate our policy regarding [exemption] petitions going forward before finalization of this rule". Industry groups expect the agency will try to conclude the rule-making before November. The proposed mandates for 2026-2027 will have to go through the typical public comment process and could be changed as regulators weigh new data on biofuel production and food and fuel prices. Once the program updates are finalized, lawsuits are inevitable. A federal court is still weighing the legality of past mandates, and the Supreme Court is set to rule this month on the proper court venue for litigating small refinery exemption disputes. Environmentalists are likely to probe the agency's ultimate assessment of costs and benefits, including the climate costs of encouraging crop-based fuels. Oil companies could also have a range of complaints, from the record-high mandates to the creative limits on foreign feedstocks. American Fuel and Petrochemical Manufacturers senior vice president Geoff Moody noted that EPA was months behind a statutory deadline for setting 2026 mandates and said it would "strongly oppose any reallocation of small refinery exemptions" if finalized. By Cole Martin and Matthew Cope Proposed 2026-2027 renewable volume obligations bn RINs Fuel type 2026 2027 Cellulosic biofuel 1.30 1.36 Biomass-based diesel 7.12 7.50 Advanced biofuel 9.02 9.46 Total renewable fuel 24.02 24.46 Implied ethanol mandate 15 15 — EPA Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Israel, Iran exchange strikes: Update


25/06/13
25/06/13

Israel, Iran exchange strikes: Update

Updates with details throughout Washington, 13 June (Argus) — Israel continued to attack nuclear facilities in Iran and Tehran retaliated with missile strikes against Tel Aviv and elsewhere in Israel on a day that saw sharp escalation across the world's largest oil producing region. Israel's Air Force said today it completed another round of attacks against Iran while prime minister Benjamin Netanyahu said his country will continue attacking Iran "as long as necessary". The latest Israeli attack, following broader strikes in the early hours Friday, targeted a nuclear facility near Isfahan in Iran's northwest, according to Israel's Air Force post on social media platform X at 8:40pm local time (5:40pm GMT). A barrage of Iranian ballistic missiles landed in Tel Aviv in late evening hours Friday local time, as Iran's Islamic Revolutionary Guards Corps (IRGC) said it will deliver a "crushing and precise response" to Israeli strikes that decapitated Iran's military leadership, knocked out the country's air defense and caused some damage to the country's nuclear programme facilities. The exchange of air and missile strikes has so far spared oil infrastructure in Iran and elsewhere in the region. Israel has halted production at two of its major natural gas fields and cut pipeline exports to Egypt following the attack on Iran. Crude market participants said they were concerned that Israeli attacks on Iran could extend beyond the existing military targets and nuclear infrastructure, and target the country's oil fields and facilities. The July Nymex WTI contract was trading near $73/bl at 3pm ET, about 8pc above yesterday's settlement price. Israel's military said earlier in the day that it intercepted a barrage of drones launched from Iran and Yemen. The ballistic missiles Iran used later in the evening are faster moving and harder to intercept, said former US assistant secretary of state Barbara Leaf. Iran last used them to attack Israel in October 2024. "We must give a strong response," Iran's supreme leader, Ayatollah Ali Khamenei said before the Iranian missile strikes on Israel. "They shouldn't imagine that they've attacked us and that everything is over now." What next? The immediate aftermath of the attack on Iran, launched in the early hours Friday local time, points to a serious toll in leadership ranks, including the Islamic Revolutionary Guards Corps commander-in-chief Hossein Salami and Iran's army chief, Mohammad Bagheri. US president Donald Trump convened a national security council meeting at 11am ET today, with no readout yet on any potential measures it could take in response to a hike in oil prices. US forces across the Middle East are on alert and the US administration pledged to help defend Israel from further attacks. The conflict has the potential to spread to neighboring countries and Trump's sidelining or forced retirement of professional diplomats at the State Department and the White House national security council leaves his administration with fewer resources to dial down tensions or to prevent Israel from taking drastic steps, Leaf said during a discussion hosted by think tank the Middle East Institute. "Iraq is in the bull's eye," said Leaf, who left the State Department in January. "The Gulf states are obviously very vulnerable. Egypt and Israel have been acutely threatened by the conflict in Gaza, and this kind of adds a new pile on, but I worry about Iraq." The apparent initial success of Israel's military operation could prompt Netanyahu to press his advantage against Iran and "one of my concerns would be that... the drive to go forward toward regime change will be just too tempting," Leaf said. "This is a country of 83 million people. It's not a non-state actor like Hezbollah" in Lebanon, she said. "As immense an achievement it was for the Israel Defense Forces to take Hezbollah apart, it is not the same thing as really decapitating a country and then seeing how it all works out." By Haik Gugarats Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

EPA proposes record US biofuel mandates, foreign limits


25/06/13
25/06/13

EPA proposes record US biofuel mandates, foreign limits

New York, 13 June (Argus) — President Donald Trump's administration today proposed requiring record biofuel blending into the US fuel supply over the next two years, including unexpectedly strong quotas for biomass-based diesel. The US Environmental Protection Agency (EPA) proposal, which still must be finalized, projects that oil refiners will need to blend 5.61bn USG of biomass-based diesel to comply with requirements in 2026 and 5.86bn USG in 2027. That's a 67pc increase in 2026 and a 75pc increase in 2027 from this year's 3.35bn USG requirement, above what most industry groups had sought. The proposal alone is likely to boost biofuel production, which has been down to start the year as biorefineries have struggled to grapple with uncertainty about future blend mandates, the halting rollout of a new clean fuel tax credit, and higher import tariffs. The EPA proposal also would halve Renewable Identification Number (RIN) credits generated for foreign biofuels and biofuels produced from foreign feedstocks, a major change that could increase US crop demand and hurt renewable diesel plants that source many of their inputs from abroad. US farm groups have lamented refiners' rising use of Chinese used cooking oil and Brazilian tallow to make renewable diesel, and EPA's proposal if finalized would sharply reduce the incentive to do so. The Renewable Fuel Standard program requires US oil refiners and importers to blend biofuels into the conventional fuel supply or buy credits from those who do. One USG of corn ethanol generates one RIN, but more energy-dense fuels like renewable diesel can earn more. In total, the rule would require 24.02bn RINs to be retired next year and 24.46bn RINs in 2027. That includes a specific 7.12bn RIN mandate for biomass-based diesel in 2026 and 7.5bn in 2027, and an implied mandate for corn ethanol of 15bn RINs, similar to prior years. EPA currently sets biomass-based diesel mandates in physical gallons but is proposing a change to align with how targets for other program categories work. US soybean oil futures surged following the release of the EPA proposal, and RIN credits rallied similarly. Current year D6 credits, typically generated from conventional ethanol production, traded at 92¢/RIN near the opening of the session before peaking at 110¢/RIN and then retreating slightly. Current year biomass-based diesel D4 RINs followed a similar trajectory, trading up to 116¢/RIN and widening the gap with conventional D6 RINs. Proposed targets are less aspirational for the cellulosic biofuel category, where biogas generates most credits. EPA proposes lowering the 2025 mandate to 1.19bn RINs, down from from 1.38bn RINs previously required, with 2026 and 2027 targets proposed at 1.30bn RINs and 1.36bn RINs, respectively. In a separate final rule today, EPA cut the 2024 cellulosic mandate to 1.01bn RINs from 1.09bn previously required, a smaller cut than initially proposed, and made available special "waiver" credits refiners can purchase at a fixed price to comply. Small refinery exemptions The proposal includes little clarity on EPA's future policy around program exemptions, which small refiners can request if they claim blend mandates will cause them disproportionate economic hardship. EPA predicted Friday that exemptions for the 2026 and 2027 compliance years could total anywhere from zero to 18bn USG of gasoline and diesel. EPA plans to continue a policy from past administrations of estimating future exempted volumes when calculating the percentage of biofuels individual refiners must blend, effectively requiring those with obligations to shoulder more of the burden to meet high-level volume targets. EPA in the proposal said it plans to "communicate our policy regarding [exemption] petitions going forward before finalization of this rule". Industry groups expect the agency will try to conclude the rule-making before November. Notably though, the proposal says little about how EPA is weighing a backlog of more than a hundred requests for exemptions stretching back to 2016. Many of these refiners had already submitted RINs to comply and could push for some type of compensation if granted retroactive waivers, making this part of the program especially hard to implement. An industry official briefed on Thursday ahead of the rule's release said Trump administration officials were "coy" about their plans for the backlog. The proposed mandates for 2026-2027 will have to go through the typical public comment process and could be changed as regulators weigh new data on biofuel production and food and fuel prices. Once the program updates are finalized, lawsuits are inevitable. A federal court is still weighing the legality of past mandates, and the Supreme Court is set to rule this month on the proper court venue for litigating small refinery exemption disputes. By Cole Martin and Matthew Cope Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Exomad Green starts building Bolivian biochar plant


25/06/13
25/06/13

Exomad Green starts building Bolivian biochar plant

London, 13 June (Argus) — Bolivian biochar producer Exomad Green has started building a 128,000 t/yr biochar production plant in the country's Guarayos region, which it expects to achieve 320,000 t/yr of CO2 removal (CDR) once fully operational. The facility will be developed in two phases. Half of the total capacity will be developed in phase one, which is scheduled to be fully operational by mid-2026, with the second phase expected to start in 2026. Exomad did not provide a timeline for the scheduled end of the latter phase. The firm plans to distribute biochar to indigenous communities and farmers to restore degraded soils, enhance food production and improve resilience to climate stress, through its "biochar donation program" it said, without specifying what share of the end product would be allocated for this program. Exomad signed a 10-year biochar CDR agreement with technology giant Microsoft to remove 1.24mn t of CO2 in late May. The contract has embedded digital monitoring, reporting and verification carried by Germany-based Carbonfuture to enable third-party verification and certification under crediting platform Puro.earth's biochar methodology. The parties had previously also signed a deal for 32,000t of biochar CDR credits in December 2023. Exomad estimates it had sequestered over 120,000t of CO2 by April through its biochar operations. The firm already operates two biochar plants in Concepcion and Riberalta, each with 60,000 t/yr of capacity. The company uses hardwood forestry residues as feedstock to produce biochar with up to 86pc fixed carbon content through pyrolysis. Exomad Green is a unit of Exomad, which is the largest wood exporter in Bolivia. By Erisa Senerdem Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

WTI crude surges after Israel attack on Iran


25/06/13
25/06/13

WTI crude surges after Israel attack on Iran

Houston, 13 June (Argus) — WTI crude futures jumped by as much as 14pc today after Israel carried out strikes against Iran, sparking concerns over possible disruptions to Middle East oil supplies. WTI prices rose as high as $77.62/bl early, a nearly five-month high, but gave up some of the gains later in the morning. The July Nymex WTI contract was trading near $73/bl at 10:30am ET, about 7pc above yesterday's settlement price. In equity markets, the Nasdaq was down by 1.44pc and the S&P 500 fell by 0.97pc as of 10:30am ET. Iranian state media reported a first wave of strikes over the capital city, Tehran, at around 03:20 local time (23:50 GMT). Images and videos published by the state broadcaster showed residential towers that had been struck in the attack, causing numerous casualties. The US said it was not involved in the Israeli strikes and advised Tehran not to retaliate against US personnel in the Middle East. Iran's oil infrastructure appeared to be unscathed from the strikes , according to Iran's state news agency Irna and Argus sources. But the attacks have raised the prospect of a broader escalation in the world's largest oil-producing region. Israel said the strikes targeted military facilities and infrastructure linked to Iran's nuclear program. It described the operation as an act of self-defense, claiming Iran is "closer than ever" to acquiring a nuclear weapon. Iranian officials said talks with US officials over its nuclear program scheduled for this weekend can no longer take place . Iran informed the International Atomic Energy Agency (IAEA) that its Bushehr nuclear power plant was not targeted and that no increase in radiation levels had been observed at its Natanz site, IAEA director general Rafael Grossi said today. The attacks have raised the risk of disruption to shipping in the region, prompting concerns over rising freight rates, insurance costs and vessel safety. Market participants warn that freight rates could surge if the conflict drags on or if Iran launches a retaliatory strike. The region includes one of the world's most critical oil and shipping corridors, centered on the Strait of Hormuz — a chokepoint for about a fifth of global oil supply. Ships operating in or transiting the Mideast Gulf and the Strait of Hormuz could face higher costs and delays. "Insurance companies could raise the cost of additional war risk premiums (AWRP) if the conflict continues for a long time," a shipbroker said. Other freight market participants echoed this view. "Mideast Gulf freight rates could spike because owners will avoid going there," another source said, adding that shipowners are likely to err on the side of caution. All Egyptian urea plants have stopped production because of a drop in natural gas flows from Israel, with suppliers withdrawing urea offers. Greek independent oil and gas producer Energean has suspended production from its Karish gas field offshore Israel in line with an Israeli government order after the strikes. Several international airlines have diverted or cancelled flights. Iran's civil aviation authority announced that the airspace over Tehran will be closed "until further notice" following the initial strikes, and all flights have been grounded across the country's airports. By Eunice Bridges Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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