Energy Musings - October 17, 2025
The International Maritime Organization's Net-Zero Framework plan saw its approval vote pushed out for a year. IMO officials and framework supporters were shocked. The US led the opposition.
IMO Net-Zero Framework Is Delayed A Year
Today, UN Ambassador Mike Waltz announced that the International Maritime Organization (IMO) voted to delay for a year the final vote on the organization’s Net-Zero Framework, which would have levied the world’s first carbon tax. This shocking development came after pushback from many countries led by the United States.
The 2nd Extraordinary Session of the Marine Environment Protection Committee, held from October 13 to 17, failed to advance the framework despite a majority of members in attendance at an April meeting approving it. That vote started a six-month period for all IMO members to consider the framework plan. During this time period, various global shipping parties openly opposed it, led by the Trump administration. Leading Greek shipowners, among others, pushed back, and last month, the head of the influential American Bureau of Shipping (ABS) called for a timeout so amendments to the plan could be considered. We wrote about the growing opposition in our Energy Musings of October 6, 2025.
According to reports, Singapore tabled a motion to delay the Net-Zero Framework for a year. Saudi Arabia, opposed to the agreement, called for a vote on the motion. It passed by a 57-49-21 vote, 127 total votes. Interestingly, in April, the Net-Zero Framework was approved in a 63-16 vote, representing only 79 members.
To approve the Net-Zero Framework, a two-thirds approval vote was required, or 85 members. Even if we assume that the 21 abstaining members were in favor, they would have fallen 15 votes short of approval. This was shocking, as the IMO had already established a drafting group to prepare the final text of the revised MARPOL Annex VI 2025, regulations within the International Convention for the Prevention of Pollution from Ships, that would include the framework.
The idea that all ships greater than 5,000 gross tons involved in international shipping would be taxed on their carbon emissions above certain thresholds was rejected completely by the United States. Those emissions thresholds would progressively tighten, raising the cost of operating vessels that could not meet the tests. The money raised by the penalties would go into a UN fund that the organization’s bureaucracy would disperse to help countries and parties harmed by the increase in shipping costs. This fund and its operation were an additional reason why the Trump administration opposed the IMO framework.
One estimate concluded that shipowners would need to invest $1 trillion by 2050 to comply with the IMO’s framework plan. ABS has estimated that under the IMO plan, a vessel trading in the European Union market will see its daily operating expenses triple from $15,000 to $45,000 between 2028 and 2035. Imagine what that daily cost increase will mean for the price of goods and materials transported. Moreover, the ABS noted that the IMO plan models LNG, despite its fuel-bridging ability, as over-penalized in the early 2030s, reducing its potential role in mitigating carbon emissions by the global shipping industry.
Although the IMO Net-Zero Framework plan was only delayed by 12 months, the large number of nations opposed to the plan must be viewed as confirmation that the climate change push is weakening. We would not be surprised if the framework is massively overhauled before coming to a vote next October.
The economic price of climate change policies, given their lack of success in reducing emissions, is being recognized by those bearing the cost. They no longer want to be handed the bill, and they are letting their political leaders know it.