Just 15 percent of the world’s refineries know how they will manage tighter rules on the amount of sulphur that can be burned in shipping fuels by 2020, survey by consultancy KBC showed.

The tighter rules, announced by the International Maritime Organization (IMO) limit the sulphur emissions for bunker fuels to no more than 0.5 per cent from the current level of 3.5 percent. This means shippers have to replace some 3 million barrels per day (bpd) of high-sulphur fuel.

Stephen George, KBC chief economist warned that while refineries are mostly waiting to see how many ships will install “scrubbers” that allow them to continue to burn fuel oil, waiting will leave less complex refineries “severely economically disadvantaged”.

“The bunker fuel transition may prove a perfect time to implement new margin-boosting technology,” George said, adding that the right investments now could help “future-proof” refineries and allow them to meet the demand for cleaner shipping fuel.

Source: Reuters (Reporting By Libby George)