UN Shipping Agency Delays Decision on Carbon Price under US Pressure

October 17, 2025

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by Enes Tunagur and Jonathan Saul (Reuters) US and Saudi Arabia strongly oppose carbon price on shipping; Trump urged countries to vote no to the emission-reduction measure; Majority of 57 countries voted to delay decision, 47 opposed -- A majority of countries at the U.N. shipping agency voted on Friday to postpone by a year a decision on a global carbon price on international shipping, after failing to reach consensus on the emissions reduction measure amid U.S. pressure.

The decision to delay the deal is a blow to the European Union and other countries including Brazil which have been pushing for the global shipping industry to go greener and set out a price mechanism for decarbonisation.

Washington and Riyadh, the world's two largest oil producers, have strongly opposed a carbon price on shipping during talks in London at the International Maritime Organization (IMO).

The Trump administration is looking to boost U.S. economic might, including by taking a bigger role in global shipping, and has used tariffs as a weapon to extract better terms from Washington’s trade partners.

After days of disagreements, Saudi Arabia tabled a motion on Friday to defer discussions for one year, which was passed by a simple majority of 57 countries with 49 opposed who sought to continue with a deal.

U.S. President Donald Trump called on IMO member states on Thursday to vote no, saying on his Truth Social platform that Washington would "not stand for this global green new scam tax on shipping and will not adhere to it in any way, shape or form".

"The delay leaves the shipping sector drifting in uncertainty," said Faig Abbasov, director of shipping with environmental group Transport & Environment.

The IMO struck a preliminary deal to charge the global shipping industry for emissions in April after the U.S. pulled out of associated talks, prompting Washington to threaten to use visa restrictions and sanctions on countries that voted in favour.

The IMO, which comprises 176 member countries, is responsible for regulating the safety and security of international shipping and preventing pollution.

"Let’s not celebrate. There are concerns we need to address," IMO Secretary-General Arsenio Dominguez told delegates in closing remarks.

Global shipping accounts for nearly 3% of the world's CO2 emissions. About 90% of the world's trade is conducted by sea, and emissions are set to soar without an agreed mechanism. READ MORE

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Excerpt from DD News/Reuters: The United States, Singapore, Liberia and Saudi Arabia on Friday called on the U.N. shipping agency to postpone adoption of a carbon price on ships, as states failed to find consensus during talks in London this week. READ MORE

Excerpt from AFP/France 24: Increased divisions, notably between oil producing nations and non-oil producers, emerged this week at meetings leading up to Friday's planned follow-up vote to approve the scheme.

Delegates instead voted on a hastily-arranged resolution to postpone proceedings, which passed by 57 votes to 49.

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A Russian delegate described proceedings as "chaos" as he addressed the plenary Friday after talks had lasted until the early hours.

Russia joined major oil producers Saudi Arabia and the United Arab Emirates in voting against the carbon-reduction measure in April, arguing it would harm the economy and food security.

IMO Secretary-General Arsenio Dominguez, representing 176 member states, pleaded Friday that he hoped there would be no repeat of how the week's discussions had gone.

"It doesn't help your organisation, it doesn't help yourself," he told delegates.

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Washington threatened to impose sanctions, visa restrictions and port levies on those supporting the Net Zero Framework (NZF), the first global carbon-pricing system.

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Ahead of this week's London gathering, a majority 63 IMO members that in April voted for the plan had been expected to maintain their support and to be joined by others to formally approve the NZF.

Argentina, which in April abstained from the vote, now opposes the deal.

Leading up to Friday's decision -- China, the European Union, Brazil, Britain and several other members of the IMO -- reaffirmed their support.

The NZF requires ships to progressively reduce carbon emissions from 2028, or face financial penalties.

Shipping accounts for nearly three percent of global greenhouse gas emissions, according to the IMO, while the CO2 pricing plan should encourage the sector to use less polluting fuels.

The Philippines, which provides the most seafarers of any country, and Caribbean islands focused on the cruise industry, would be particularly impacted by visa restrictions and sanctions.

The plan would charge ships for emissions exceeding a certain threshold, with proceeds used to reward low-emission vessels and support countries vulnerable to climate change.

Pacific Island states, which abstained in the initial vote over concerns the proposal was not ambitious enough, had been expected to support it this time around.

If the global emissions pricing system was adopted, it would become difficult to evade, even for the United States.

IMO conventions allow signatories to inspect foreign ships during stopovers and even detain non-compliant vessels. READ MORE

Excerpt from Politico: A fractious meeting of the International Maritime Organization in London ended Friday with a decision to adjourn for a year, after Saudi Arabia, backed by Russia, pushed for a pause.

That means the effort to set binding international rules to cut greenhouse gases from shipping — responsible for about 3 percent of global emissions — goes into the deep freeze for a year. During that time, the U.S. and other opponents can try to rally more support to kill it completely.

The move followed an extended pressure campaign from the United States marked by threats of tariffs and other economic penalties. It is also a huge setback for the European Union, which failed to push through the measure and even saw some of its member countries abstain.

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But European Commission Executive Vice President Teresa Ribera called the delay “a huge shame,” in a social media post. The EU and Brazil had been publicly backing the move ahead of COP30 global climate talks next month, hosted by Brazil.

The proposal up for approval at the IMO, the U.N. agency that regulates global shipping, was meant to incentivize countries to shift toward using cleaner fuels in a bid to zero out carbon emissions from shipping by 2050. It would have increased the financial burden on polluting ships over time. Fees collected would go to help fund the shift to greener fuels and support developing countries.

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The motion to adjourn on Friday passed by just four votes, after several countries that had previously backed the measure, including EU members Greece and Cyprus, chose to abstain.

"The net zero framework relies on fuels and technologies that aren’t available at scale, and introduces sharp penalties for not using them, which would inflate costs as companies chase limited supplies," said a Greek official, speaking on condition of anonymity. Greece hosts some of the world’s leading shipping companies.

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“They killed [the agreement]. The lack of leadership from the EU makes my blood boil,” said one person with knowledge of the discussions, also granted anonymity to speak candidly.

However, the move garnered support from major fossil fuels producers, such as Saudi Arabia and Russia, which traditionally push back against climate measures aimed at cutting the use of oil, gas and coal. Major shipping countries and several with large flag registries, including Singapore and Liberia, also objected.

Others shifted positions.

China, the world’s biggest ship builder, switched from supporting the measure in April, to voting to delay it on Friday.

The clash highlighted the differences between countries worried about the measure's economic impact against those fearing the consequences of global warming.

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The International Chamber of Shipping, a global trade association representing more than 80 percent of the world’s merchant fleet, said it was disappointed with the outcome.

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“Industry needs clarity to be able to make the investments needed to decarbonize the maritime sector,” Thomas A. Kazakos, the chamber’s secretary-general, said in a statement. “As an industry we will continue to work with the IMO, which is the best organization to deliver the global regulations needed for a global industry.”

Part of the shipping industry is worried that if the IMO effort fails, the result could be a patchwork of national and regional measures that will be expensive and confusing for the sector. READ MORE

Excerpt from Agri-Pulse: An International Maritime Organization plan intended to slash carbon emissions from ocean vessels is being delayed in the face of strong opposition from President Donald Trump. The biofuels industry has hoped the IMO plan would help open up a new market for agricultural feedstocks. READ MORE

Excerpt from Argus Media: The International Maritime Organization (IMO) secretary general Arsenio Dominguez said the net-zero framework (NZF) "remains very much alive" even though member states today (October 17, 2025) voted to adjourn an adoption vote for a year.

Speaking at the conclusion of this week's extraordinary Marine Environment Protection Committee (MEPC) session, Dominguez said the decision was only to adjourn and there remains a work plan to be discussed and agreed.

It is not a "blow to the organisation", he said, noting the Intersessional Working Group on the Reduction on Greenhouse Gas Emissions from Ships is still scheduled to meet next week to discuss and continue work on guidelines for implementing the NZF.

The "outcome today was because the member states required more clarification on the amendments," Dominguez said. But he confirmed that IMO procedures allow for further adjournment to an adoption vote.

Dominguez said he knew the stakes were high, pointing to an "intense" process that began with the 2023 adoption of a revised greenhouse gas (GHG) emissions strategy. Dominguez also acknowledged geopolitics are having an effect on NZF discussions.

He did not provide a firm response to a question on whether the adoption delay would result in a later start date for the GHG pricing mechanism, but he acknowledged that IMO rules require 16 months from adoption to enforcement. Dominguez said concerns were raised about how amendments will be implemented and how the proposed net zero fund will be administered.

Dominguez also said the way of implementing the NZF is yet to be defined, since proposals can be adopted via tacit or explicit acceptance. He said while both procedures exist in the convention, tacit acceptance has served the organisation very well in all its work so far and that he looks forward to maintaining that approach for the NZF.

Asked about how companies can make investment decisions, ranging from new vessel orders to fuel procurement, in light of the NZF uncertainty, the secretary general said: "The more proactive we are in this industry, the more it brings additional clarity to the framework." READ MORE

Excerpt from Bloomberg: The administration of President Donald Trump got the world to delay a global price on shipping emissions, but this decision is doomed to fail. READ MORE

Excerpt from Trellis: “This is a loss of momentum for the shipping industry’s efforts to decarbonize,” said a spokesperson for Maersk, which operates more than 700 container vessels on routes between 130 countries.

Currently, companies intent on tackling these emissions rely on a patchwork of initiatives including Katalist, a “book and claim” platform that allows them to support and take credit for purchases of low-carbon maritime fuels, such as ammonia and methanol. Members include Amazon, IKEA, Levi Strauss, Mondelez International and Patagonia.

That project and others continue, but spread of the new technologies will be far slower in the absence of the rules the framework would have imposed.

“We are in a very early part of a transition, and more than 99 percent of maritime transport is still powered by fossil fuels,” said Jesse Fahnestock, director of decarbonization at the Global Maritime Forum, a non-profit that partners with shipping companies. “So to get alternative fuels and the vessels that can use them out there, the regulatory framework is a hugely important lever.”

Talks continue

Despite the pressure from the U.S. and others, nations agreed to delay rather than scrap the framework altogether. Fahnestock noted that because the proposal is still live, discussions about the details of implementation scheduled over the next 12 months may continue as planned.

“Our impression is that the how of the framework is going to continue,” he said. Talks will focus on which fuels qualify as lower-carbon, rules for life-cycle analysis of the fuels and how proceeds credits, which vessel owners can use to meet missed targets, will be distributed.

Still, standing in the way of an agreement is the world’s largest economy. In a joint statement issued last week, U.S. secretaries for state, energy and transportation said they were considering sanctions against officials from countries that support the IMO framework and blocking vessels registered in those countries from U.S. ports. READ MORE

Excerpt from Politico: At a meeting of the International Maritime Organization last week, Athens dropped its support for the fee and other measures meant to reduce planet-warming pollution from shipping, bowing to pressure from industry and the U.S.

On Tuesday, EU environment ministers approved the bloc’s joint negotiating position for this year’s COP30 climate summit — largely a rubber-stamping exercise — with significant delay after Greece initially vetoed the text over a reference to the IMO agreement.

Five diplomats present at the talks told POLITICO that Athens objected to a single passage, the final paragraph of the text, that “welcome[d]” the IMO measures “as the first legally binding global sectoral climate regulation that will contribute to the reduction of emissions from shipping.”

Three of the diplomats, who were granted anonymity to discuss closed-door talks, said Greece had opposed any mention of the IMO levy and rejected several attempts at compromise.

With the text requiring unanimous approval from the EU’s 27 governments, ministers adjourned the debate for several hours while diplomats scrambled to find a solution. But Greece even rejected a last-ditch proposal, seen by POLITICO, to merely "recall" that the IMO negotiations took place.

In the end, ministers could only agree on deleting the IMO reference entirely. READ MORE

Excerpt from G Captain: Anaïs Rios, Shipping Policy Officer at Seas At Risk, said the Net-Zero Framework could give shipping a fighting chance to meet its climate goals, even if it is far from perfect, but countries must stop dragging their feet. “With adoption now delayed, this week at the IMO is about creating the regulatory architecture of the framework and finding clear incentives to scale up wind propulsion, a proven solution to reduce emissions today. After all, wind technology is available, it’s fair and it works: it is a proven, equitable solution in the race to decarbonisation.” READ MORE