Overview
IntroductionThe global shipping industry, which is responsible for over 3% of global greenhouse gas emissions, has come under increasing environmental and regulatory scrutiny in the wake of intensifying efforts to combat climate change. Shipping, being the cornerstone of international trade and accounting for over 80% (by volume) of the world’s goods, plays a vital role in the global economy, thereby making its decarbonization a crucial concern for both industry stakeholders and policymakers alike.
Due to their 1,076 million tonnes (Mt) of anthropogenic greenhouse gas emissions (in carbon dioxide equivalent [CO2e]) in 2018, ships are responsible for 3% of global anthropogenic GHG emissions.[1] Without stringent strategies and policies, CO2 emissions from the shipping industry are projected to rise to 130% of 2008 levels, and could constitute 17% of global CO2 emissions by 2050 due to increased freight demand and decarbonisation efforts in other sectors. In response to this growing concern in maritime operations, the International Maritime Organization (IMO) has taken a significant step by approving a set of draft regulations aimed at steering the shipping industry toward net-zero emissions by or around 2050.
These draft regulations form a key part of the IMO’s revised Strategy on the Reduction of GHG Emissions from Ships, adopted in 2023, and reflect the growing consensus on the urgent need for climate action across all sectors. At the 83rd session of the Marine Environment Protection Committee (MEPC 83) held at the IMO headquarters in London, between April 7 –11, 2025, the IMO member states agreed to implement a groundbreaking global pricing mechanism for greenhouse gas (GHG) emissions, marking a pivotal step toward decarbonising maritime transport. A global fuel standard that gradually reduces the annual greenhouse gas fuel intensity of marine fuel and a greenhouse gas pricing mechanism that makes high-emitting ships pay for their excess pollution are the two strategies introduced by the IMO framework.
