The U.S. House of Representatives has recently approved the bill to lift the 40-year-old ban on crude exports, but the legislation faces an uphill battle in the Senate after President Barack Obama threatened to veto any measure that ends the ban.
The measure passed by a vote of 261 – 159, the House Energy and Commerce Committee said in a statement, adding that "studies have shown that lifting the antiquated ban on crude oil exports would lower prices at the pump, support job growth, and strengthen America's national security and geopolitical influence across the globe."
American Petroleum Institute (API) has welcomed the passing of this bipartisan legislation.
"American producers would be able to compete on a level playing field with countries like Iran and Russia, providing security to our allies and accelerating the energy revolution that has revitalized our economy." said API President and CEO Jack Gerard.
However, those against the bill claim that lifting of the ban will only benefit large oil companies.
"This bill is an unconscionable giveaway to Big Oil at the expense of American consumers," said Florida Democrat Kathy Castor.
The recently signed Trans-Pacific Partnership (TTP) deal is the latest and biggest of the growing number of free trade agreements (FTAs) that promise heightened container growth for participating countries, according to U.K.-based shipping consultant Drewry.
There is still much to be done before TPP becomes active, especially as Hillary Clinton, the front-running U.S. presidential candidate for the Democratic Party, has voiced her opposition, while negotiators are still working on the final technical details that are expected to be released before the year is out.
However, Drewry says there is evidence that supports the argument that free trade deals do encourage heightened trade growth, specifically in the container shipping arena.
One of the most significant FTAs in recent years was the pact between the 10 member states of the Association of Southeast Asian Nations (ASEAN) with China in 2005, Drewry says. In the 10 years before the deal, the annual growth rate for China's merchandise exports to ASEAN was broadly in line with the rest of the world at 17%. Following the deal, the 10-year CAGR rose to 19% at the time when the annual rate to the rest of the world had slumped to 13%.
ASEAN really started to accelerate beyond the overall trend from 2009 onwards, which suggests it takes a few years after implementation for the trade benefits to really kick-in, according to Drewry.
Similar to the China-ASEAN pact, U.S. trade growth with its FTA partners seems to be gaining momentum as exports and imports to FTA partners are now increasing at a faster pace. Between 2009 and 2014, U.S. exports to FTA countries have grown by 64%, versus 45% for all non-FTAs, while imports from FTAs have expanded by 57% against 47%.
With regards to the containerized trade, the GATT and WTO trade deals and the entry of China into the WTO are widely credited as having accelerated international trade in general and ocean-borne trade in particular, and the available data does again suggest that FTA partners benefit from increased trade at the expense of other economies.
The liberalization of trade is a growing trend and one that will benefit container shipping companies in the long run. Drewry says that in the mid-term, investment in shipping and port infrastructure within countries that have expanded their FTA scope is probably prudent.
Houston-based American Bureau of Shipping (ABS) has released the world's first guide for SOx scrubber ready vessels to support members and clients in preparing newbuilds for future outfitting with a SOx exhaust gas cleaning system (EGCS).
The ABS Guide for SOx Scrubber Ready Vessels formalizes the process for clients who wish to plan for retrofit of a SOx scrubber at a future date by providing a detailed review and approval and an associated notation.
The SOx Scrubber Ready notation is in addition to ABS EGCS notations that may be assigned for vessels fitted with an exhaust emission abatement system, including SOx scrubbers, selective catalytic reduction systems and exhaust gas recirculation arrangements for NOx emission control, in accordance with the ABS Guide for Exhaust Emission Abatement.
"The decision to build a new ship or retrofit an existing one is not simple due to uncertainty with the entry into force of the 0.5% global sulfur limit and cleaner fuel alternatives such as LNG," said ABS Chief Technology Officer and Senior Vice President Howard Fireman.
"The new ABS SOx Scrubber Ready notation provides a unique approach to future-proof assets, to implement cost-effective retrofits and to demonstrate a commitment to environmental performance."
In addition to the new ABS Guide for SOx Scrubber Ready Vessels and Guide for Exhaust Emission Abatement, ABS has published the ABS Advisory on Exhaust Gas Scrubber Systems.
India has removed customs and excise duty on bunker fuels for India-flagged vessels in coastal and domestic trades in an effort to promote the carriage of containers by water rather than on its congested roads.
The tax exemption is applicable to IFO 180 CST and IFO 380 CST bunker fuels for Indian vessels transporting export-import (EXIM), empty and domestic containers between two ports in India, the government said in a statement.
"This tax incentive for transportation along the coast will go a long way in enhancing Indian tonnage as well as in promoting development of transportation hubs in India," said the government.
India-flagged vessels carrying EXIM and empty containers between two Indian ports have been exempt from paying customs and excise duty on bunkers since November 2014. This exemption has now been extended to carriers transporting domestic containers.
India is the world's third largest polluter and is looking for ways to cut its greenhouse gas emissions.
Singapore's Sectoral Tripartite Committee for Transport (Sea) announced new initiatives to attract and help Singaporeans deepen skills and advance their careers in seafaring and shore-based sectors.
These initiatives were drawn up by the Sectoral Tripartite Committee for Transport (Sea) led by the Maritime and Port Authority of Singapore (MPA). Comprising two task forces, the committee aims to address current gaps and recommend new initiatives to strengthen manpower development efforts for both seafaring and shore-based sectors.
In the next five years, they hope to attract more than 1,200 Singaporeans to join the maritime sector as seafarers and port operations officers. Funding for these initiatives will be drawn from the Maritime Cluster Fund and the national SkillsFuture budget.
In drawing up the initiatives, the committee focuses on three main areas; namely profiling and promoting maritime careers highlighting the multiple entry points and good career progression pathways; growing a pool of maritime talents through structured training programmes; and encouraging skills deepening and mastery.
Initial measures that will be rolled out are aimed at encouraging more Singaporeans to take up key positions in seafaring and in the port operations sector. Measures targeting other maritime sub-sectors, such as shipowning/operating, shipbroking, shipmanagement and ship agency, will be rolled out when ready.
"MPA is committed to working closely with our industry stakeholders, associations, unions and other government agencies to attract more Singaporeans into both the seafaring and shore-based sectors," said Andrew Tan, Chief Executive of MPA.
"This local core will support the growth of Singapore not only as a premier global hub port, but also a leading international maritime centre that offers a wide range of maritime services including chartering, broking, ship management, finance, legal and insurance."
South Korean port city Busan has moved closer to its goal of becoming a shipping center with the completion of a maritime cluster Sept. 25.
A 610,000m² area in the city's Dongsam district was earmarked as a cluster for the domestic maritime and fisheries industry as part of the Busan Innovation City project.
Construction of the Dongsam-dong Innovation District began in 2012 and is expected to be fully completed by 2017.
Busan Port Authority announced that four organizations have moved into the zone, which is designated to be a research and education hub for the maritime and fisheries industry.
The Korea Marine Environment Research & Training Institute has moved in, while Busan Vessel Traffic System Center, and Korea Polar Research Institute have done likewise.
The Maritime Special Rescue Division, which was created last year as part of the Ministry of Public Safety and Security to support coast guard operations following the Sewol disaster, is the other organization that has moved into the site.
The Ministry of Oceans and Fisheries targeted these organizations for the move based on their requirements and business functions. Eventually, the organizations were asked to vote as to whether they wanted the move.
The Busan Vessel Traffic System Center is built on a 1,670m² site, with a floor area of 2,258m², while the Maritime Special Rescue Division is housed in a six-storey building with a 3,200m² gross floor area, including training facilities for rescue divers.
The relocation of these institutions would place them in close proximity with Busan Port Authority, Busan Maritime High School, and National Maritime Museum.
Busan Regional Oceans and Fisheries Administration said, "Going forward, public institutions in the oceans and fisheries sphere can maximise synergies through strengthening the network of the tenant organisations."
Indian shipping needs a fund backed by the government to spur growth of the country's merchant fleet, David Rasquinha, deputy managing director of Export-Import Bank of India, told the INMEX-SMM Conference in Mumbai.
Indian-flagged ships carry barely 10% of the total export-import cargo of the country and the share is even less (7-8%) for Indian-built ships.
While Exim Bank finances shipbuilding projects, it has a broad portfolio and is not a specialist lender to the shipping industry.
The economic downturn has hit Indian shipbuilders hard but, Rasquinha argued during a panel discussion, some of them only had themselves to blame for their debt woes. He later clarified that "they mismanaged the funds, took on more orders than they could handle and even diverted part or all of the money borrowed for building vessels". He declined to name any particular examples.
However, some of the smaller yards have prospered.
"The economic downturn is a business opportunity. We have been able to cash in by building quality ships at low prices," said Suraj Dialani, business head of Vijai Marine Shipyards. "The downturn will not last forever. This is the best time to order."
Vijai Marine has so far delivered 75 vessels and claims to have built India's first river-sea vessel.
India has begun to phase out archaic shipping rules and procedures in earnest, Director-General of Shipping Deepak Shetty told the INMEX SMM India 2015 Conference in Mumbai on Sept. 23. The country is keen to improve its image in terms of making it easy to establish and run businesses, Shetty said adding that as many as 13 provisions deemed unnecessary have been struck down.
"The Directorate-General of Shipping will be acting more as a facilitator than a regulator," Shetty stressed.
Steps in this direction include the provision of a one-time licence for the life cycle of a vessel and decentralisation of licensing, under which six more centres have been opened against the earlier practice of handing out licences from the DG headquarters in Mumbai.
Speaking to IHS Maritime on the sidelines, Shetty, however, ruled out removal of cabotage restrictions.
"We have relaxed these restrictions selectively, but in the interests of the growth of the domestic merchant shipping fleet coastal cargo must be reserved for national tonnage," he emphasised referring to demands by ports seeking to attract transshipment cargo to enable foreign container lines to operate on the Indian coast.
"Also in times of emergency the country should be able to muster sufficient merchant ships to move cargo," Shetty pointed out.
As reported in IHS Maritime India has exempted foreign ro-ro ships and project cargo vessels from cabotage restrictions. However, Captain Gur Prasad Kohli, managing director, Wallenius Wilhelmsen Logistics (India) pointed out during a panel discussion that the fuel subsidy given to Indian car carriers were not applicable to foreign vessels.
"Therefore foreign ships cannot be competitive. So opening up the Indian coast to foreign ro-ro vessels is meaningless," he observed.
The U.S. House Energy and Commerce Committee voted 31-19 in favor of approving legislation to lift the nearly 40-year-old ban on crude oil exports from the U.S.A.
The bill is expected to be considered and passed by the full House later this month.
"The ban on exporting crude oil imposes an estimated USD 200-USD 600 billion cost to the U.S. economy, discourages crude oil production, prevents the creation of jobs, and causes higher gasoline prices for U.S. consumers," said the Committee Chairman Rep. Joe Barton (R-TX).
"We need to use our abundant resources for the highest and best causes – creating jobs, encouraging innovation, supporting our allies and being a leading player in the world market."
The supporters of the bill claim that studies have shown that lifting the ban would create nearly one million new jobs across the United States and help keep prices lower at the pump.
However, the bill has yet to face its biggest tests following the expected approval by the full House in the following weeks, as it still needs to secure support of several Democrats to clear the U.S. Senate.
The White House said it wouldn't back the bill because that is "a policy decision that is made over at the Commerce Department."
Instead, the administration expressed its belief in pursuing an approach that also invests in renewable energy.
The heads of 7 of the 8 political groups of the European Parliament's environment committee wrote yesterday to the Environment Ministers of the 28 EU countries urging them to include international shipping and aviation in a global climate deal at Paris.
"To promote increased climate ambition from ICAO and IMO, like all the other sectors of the global economy, aviation and international shipping require an emissions reduction target. There is no reasonable excuse to continue exempting these two economy sectors from the global policy framework. Aviation and shipping need to contribute in the same way that is required of all UNFCCC Parties, large and small," the MEP letter reads.
The Environment Ministers of the 28 European member states will be meeting on Sept. 18 to finalize the EU position for COP21.
Sotiris Raptis, clean shipping officer at sustainable transport group Transport & Environment, commented, "It's simply fair to demand from two economic sectors with emissions the size of Germany and South Korea to reduce CO2 emissions in line with keeping the global temperature increase below 2 degrees celsius. The IMO and ICAO have been procrastinating so far. The time for action has come."
The European Parliament called last week for the establishment of an EU 2030 emissions reduction target for shipping and measures for the reduction of ships' speed (slow steaming).
International aviation and shipping already account for up to 8% of the global climate change problem and their emissions are expected to grow by 2050 by 200-300% for aviation and 50-250% for shipping. It is believed that such increases would undermine efforts to limit the rise of global temperature to under 2 degrees.