Reuters. The International Energy Agency (IEA) is cautioning that switching from fuel oil to cleaner, less polluting marine diesel in ship engines would result in a net increase in global carbon dioxide emissions, require billions in refinery investments and could boost oil prices.
The International Maritime Organization (IMO) is considering the switch from fuel oil to marine diesel to improve the environmental footprint of the shipping industry.
In its monthly Oil Market Report, the IEA said that studies had concluded that converting refineries to produce enough diesel for shipping demand would produce at least an extra 53 million tonnes a year of CO2, whereas emissions from ships if using diesel would only fall by 27 million tonnes.
The loss of a large shipping market for fuel oil growing 5-7 percent as trade expands and the additional diesel demand would have massive implications for the refining sector, including potential extra investment of US$100-$150 billion, it said.
“It may also require an additional 2 million barrels per day of crude runs, which would be the equivalent of finding another Kuwait,” the West’s energy watchdog said.