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Coalition for American Energy Security in full support of IMO 2020

12 Dec 2019

The Coalition for American Energy Security (CAES) on Tuesday (10 December) issued a letter to the U.S. Senate Committee on Energy and Natural Resources Chairman Lisa Murkowski (R-AK) and Ranking Member Joe Manchin (D-WV) in full support of IMO 2020:

In a matter of weeks, the International Maritime Organization’s (IMO) 2020 standards to reduce sulfur emissions from shipping fuels will take effect. These IMO 2020 standards will enhance America’s air quality and energy dominance, while strengthening our energy economy.

Years ago, the members of the IMO joined together to address shipping emissions in international waters. The IMO 2020 standards will limit the sulfur content of marine fuel to no more than 0.5 percent by weight from the current global standard of no more than 3.5 percent. The United States has required low-sulfur marine fuel for years, so IMO 2020 will more closely align international standards with U.S. marine fuel specifications.

There are several ways that vessel owners can comply with the IMO 2020 standards—many of which rely on U.S. energy resources, including natural gas and light, sweet crude oil. And the U.S. refining industry is well positioned to supply low-sulfur marine fuels. The U.S. refining industry has invested nearly $100 billion over the last decade to increase processing capacity, improve operating efficiency, increase crude slate flexibility, and produce cleaner fuels, including low-sulfur fuels like those needed for IMO 2020.

With increased energy production and refining in the United States, we’ll see more, high-paying jobs here at home, in addition to the indirect economic benefits that stem from the energy economy to small businesses, equipment manufacturers, and others in the energy production supply chain. Not only will domestic producers and refiners benefit from the IMO 2020 standards, but America’s energy security will be strengthened and air quality improved.

In spite of these benefits, some have raised concerns about the impact on prices and energy markets. Some have claimed that prices will spike dramatically, despite data saying otherwise. Oil hovers around $56 per barrel—not $200, as some have argued—and distillate prices remain lower in 2019 than they were in 2018.

An economic analysis from Charles River Associates found that under IMO 2020, “gasoline prices see no discernable change; diesel prices may change by $.04/gallon, or less than the average monthly change in diesel prices over the last four years.”

Economists, environmentalists, analysts, and others within the government and the private sector have studied this closely and found that timely implementation of the IMO 2020 standards is in the best interest of our country.

About CAES
CAES is a diverse and broad coalition of American manufacturing workers, integrated energy companies, refiners, industry associations, shipping companies and other groups that play a crucial role in the maritime fuel supply chain. 

Published: 12 December, 2019
 

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