Lloyd's List is part of Maritime Intelligence

This site is operated by a business or businesses owned by Maritime Insights & Intelligence Limited, registered in England and Wales with company number 13831625 and address c/o Hackwood Secretaries Limited, One Silk Street, London EC2Y 8HQ, United Kingdom. Lloyd’s List Intelligence is a trading name of Maritime Insights & Intelligence Limited. Lloyd’s is the registered trademark of the Society Incorporated by the Lloyd’s Act 1871 by the name of Lloyd’s.

This copy is for your personal, non-commercial use. For high-quality copies or electronic reprints for distribution to colleagues or customers, please call UK support at +44 (0)20 3377 3996 / APAC support at +65 6508 2430

Printed By

UsernamePublicRestriction

One Hundred People 2024: Shipping’s elite take pragmatic stand as uncertainty reigns

Industry optimism has waned in the face of the difficult detail of policy decisions that will define shipping’s future

IMO guidance on the regulatory framework towards net zero could be just months away — or then again, it might not be. Despite being in a state of flux, those at shipping’s forefront are opting for pragmatism rather than simply lying in wait

BROWSE through the pages of Lloyd’s List’s Top 100 People from three or four years ago, and you will find a more optimistic outlook shown by those individuals at the vanguard of shipping.

Whether about the big thematic trends of the era — decarbonisation and digitalisation — or on innovation and technological development, sentiment was increasingly positive regarding the direction of the industry and the speed of change.

Fast-forward to today and this initial optimism has given way to reality — a reality about the difficult detail of policy decisions that will ultimately shape shipping’s future and an ever-increasingly complicated path to decarbonisation.

In reaching this tipping point, we find an industry that is hesitant about what happens next, while there has been a huge amount of uncertainty underwriting decisions over the past year.

 

 

 

Fundamentally, shipping is waiting for the International Maritime Organization’s next move. While targets for net zero by 2050 have been set, the industry is still none the wiser as to how exactly these targets will be achieved.

In the middle of next year, the UN body will convene in London for its next iteration of the Marine Environment Protection Committee, a gathering of minds on which hopes are pinned to determine the regulatory framework for an industry starved of concrete guidance.

Shipping and its stakeholders will be looking to No.4 Albert Embankment, London, to provide answers on a global fuel standard, and a response that comes in tandem with a carbon-pricing mechanism that can help bridge the gap with zero-carbon fuels.

Ultimately, this will determine the acceleration of climate finance, the final investment decisions of sustainable fuel supply, as well as the composition of the forward orderbook. For good or ill, everything will flow out of progress at the IMO next year.

The permutations are therefore key. A positive outcome will see the industry move as one, while a less positive one will see shipping seemingly destined for a more fragmented future.

As daunting as this may sound, this latter scenario is already taking shape — at least in part. Rather than leapfrogging directly to sustainable future fuels, such as methanol and ammonia, shipowners are increasingly looking to liquefied natural gas as the pathway while waiting for things to move. Maersk’s recent reversal on the so-called gateway fuel is a case in point.

Yet while the LNG option may seem like a step backwards, there is reason to be optimistic.

Although it seems a negative move — in the sense that it elongates the decarbonisation curve, which was always going to take generations anyway — it shows the industry is finally becoming serious on tackling the ever-pressing issue of efficiency. This is a must if the sector is to reach its 2030 goals, let alone those for 2050.

One could, though, argue that the industry still has some way in getting its commercial architecture aligned. Take the issue of how owners and charterers are still arguing over who foots the bill for paints and coatings — a factor that really should have been done and dusted five years ago.

 

 

 

 

 
 

Nonetheless, the recent spate of LNG and dual-fuel orders across nearly all sectors are signs of tangible progress. The ships being ordered today are much more efficient than the ones being ordered last year and the year before that.

The pragmatic reality here is that the industry needs to order ships and replenish the fleet — and it is doing just that, regardless of the scenarios stemming from IMO consultation.

This course of pragmatism, coupled with the uncertainty surrounding shipping’s future, are the two guiding forces of our Top 100 this year. Shipping may well be in a state of flux, but its main protagonists are refusing to lie low.

Yet the sheer enormity of next year’s IMO summit and the potential consequences are the reasons why Lloyd’s List has seen fit to award the coveted most influential person in shipping to its secretary-general Arsenio Dominguez.

While he personally will not be responsible for the IMO’s outcomes — much of this will fall on the agreement and concessions among member states, make no mistake — progress or no progress will serve to see his tenure as being the most important of any in the history of shipping’s governing body.

 

 

 

 

* Lloyd’s List defines a tanker as part of the dark fleet if it is aged 15 years or over, anonymously owned and/or has a corporate structure designed to obfuscate beneficial ownership discovery, solely deployed in sanctioned oil trades, and engaged in one or more of the deceptive shipping practices outlined in US State Department guidance issued in May 2020. The figures exclude tankers tracked to government-controlled shipping entities such as Russia’s Sovcomflot, or Iran’s National Iranian Tanker Co, and those already sanctioned. Download our explainer on the different risk profiles of the dark fleet here  

Related Content

Topics

  • Related Companies
  • UsernamePublicRestriction

    Register

    LL1151713

    Ask The Analyst

    Please Note: You can also Click below Link for Ask the Analyst
    Ask The Analyst

    Your question has been successfully sent to the email address below and we will get back as soon as possible. my@email.address.

    All fields are required.

    Please make sure all fields are completed.

    Please make sure you have filled out all fields

    Please make sure you have filled out all fields

    Please enter a valid e-mail address

    Please enter a valid Phone Number

    Ask your question to our analysts

    Cancel