The International Maritime Organization is convening this week to address the shipping industry's 3 percent share of global greenhouse gas emissions, amid closures of key Middle East waterways. The net-zero framework, which would impose fees on excess emissions to fund cleaner fuels, faces opposition from the United States and others. Geopolitical tensions have delayed progress and complicated consensus.
The shipping sector grapples with disruptions as both the Strait of Hormuz and Red Sea have been effectively closed since early March. Iran and Houthi rebels have threatened vessels in response to U.S.-Israel actions, marooning over 150 ships and forcing detours around Africa. Iran reclosed the Strait over the weekend, spiking fuel costs and making some biofuels cheaper temporarily, while crude oil prices have soared since early March—the waterway handles 20 percent of global oil supply. These events coincide with the IMO's meeting of 176 member nations to advance the net-zero framework, delayed last October after U.S. threats of tariffs, visa restrictions, and port fees from Secretary of State Marco Rubio's statement last summer. Countries previously supportive backed away, postponing adoption by at least a year. Technical work persists, but political consensus has fractured. Proposals vary: Japan suggests carbon trading without fees; Liberia, Argentina, and Panama propose eliminating fees; petrostates seek cancellation; island states push the original plan or a stronger levy. The Trump administration calls for scrapping the framework entirely, arguing it acts as a carbon tax harming U.S. consumers and lacks consensus. “The Iran war has certainly complicated things,” said Evelyne Williams, a research associate at Columbia University's Center on Global Energy Policy. She noted U.S. leverage via LNG markets. Em Fenton of Opportunity Green warned removing fees would be “catastrophic,” stripping regulatory teeth and investment certainty. The shipping industry, via the International Chamber of Shipping's Thomas Kazakos, supports a unified IMO policy to avoid patchwork regulations like the EU's carbon pricing. “As long as something is moved through the door, it can be iterated upon,” Williams added, fearing a full restart.
