Sulphur Cap in Shipping 2025: Still Steering or Losing Course?

Evolution of the Sulphur Cap: Global and Regional

•           Global limit (IMO 2020): Since 1 January 2020, vessels worldwide must use fuels with ≤0.50% sulphur unless equipped with scrubbers.

•           ECA standards: Stricter limits apply—≤0.10% sulphur—within designated zones: North America, Baltic, North Sea, US Caribbean, and as of 1 May 2025, the Mediterranean ECA joined them.

Is It Functional? The Status of Implementation

Widespread Compliance & Cleaner Fuel Usage

Major fleets have transitioned to very-low-sulphur fuel oil (VLSFO) or installed exhaust gas cleaning systems (scrubbers). Outside ECAs, ships not using scrubbers consistently meet the ≤0.50% limit, and within ECAs, compliance with ≤0.10% is generally solid.

Challenges & Grey Areas

•           Shadow fleets—including vessels carrying sanctioned oil—often remain unregulated and burn high-sulphur fuel oil (HSFO), bypassing checks and avoiding penalties.

•           Self-reporting of non-compliance has been proposed as a solution, but enforcement remains uneven.

Corporate Adherence: Who’s Doing What

Big Shipping Lines

•           Maersk and others have secured ULSFO (≤0.10%) supplies in key ECAs, including the Mediterranean, and report full fleet compliance.

•           Those using scrubber-fitted vessels can still rely on HSFO outside ECAs—though not within scrubber-restricted zones.

Fuel Suppliers & Refineries

•           Demand for cleaner marine fuels is surging—Doba crude is being increasingly refined into ultra-low-sulphur fuel oil (ULSFO) for Mediterranean and EU needs.

•           Supply strains have moderated fuel premiums in Asia but are expected to tighten with new regional mandates.

Economic & Operational Impacts

•           Freight rates rising due to increased fuel costs and compliance penalties—such as the EU’s FuelEU Maritime and ETS schemes—are being passed to end users.

•           Cost pressure remains significant: scrubber installations, cleaner fuel, and operational compliance add to shipping costs Maritime Optima.

Critical Hurdles & Risks Ahead

•           Inconsistent port policies: Some ports ban open-loop scrubbers and have varying washwater discharge rules, forcing rerouting or compliance strategies.

•           Enforcement gaps: Ships in shadow fleets evade scrutiny—regulatory blind spots may undermine environmental aims.

•           Evolving ECAs: With the Mediterranean’s 2025 inclusion and possible new zones, shipping companies must continually reschedule bunkering and logistics.

Conclusion

The sulphur cap remains largely functional and enforced—global and regional limits are well-integrated, and major players are adjusting operations accordingly.

However, the system’s effectiveness is under threat from unregulated fleets, fragmented port policies, and economic burdens that ripple through the supply chain.

For real progress, the industry needs stronger enforcement mechanisms—especially around shadow fleets—and standardized rules across ports. Without these reforms, the sulphur cap risks becoming a paper promise rather than a climate action.