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Reacting to the election of Donald Trump as US President, representatives of the maritime industry and environmental organisations alike are confident that his return to the White House will not thwart shipping’s energy transition.

‘Four years of a Trump administration is not going to derail the planet’s decarbonisation efforts,’ said Adrian Tolson, owner of US-based maritime consultancy 2050 Marine Energy and Vice Chair of the International Bunker Industry Association (IBIA), in an interview with Bunkerspot.

‘There’s enough commitment, frankly, from the world’s major nations that, if the US takes a back seat for a few years, it just takes a back seat for a few years. It’s probably indicative of the future sort of geopolitics of the world.’

With critical decisions on a potential global levy for shipping to take place at MEPC 83 in the spring, Tolson acknowledged that a new climate-sceptic Trump presidency might alter the mood music at IMO discussions, but he doesn’t believe this will drastically change the longer-term picture to 2050. ‘I could see things being slowed down, but not derailed.’

Allyson Browne, CEO of High Ambition Climate Collective, a US-based non-profit environmental organisation, painted a similar picture.

‘On the international stage, we’re well underway on developing the international enforcement measures for the 2022 IMO GHG reduction strategy, and the IMO will continue to move ahead with the adoption of the planned basket of measures next year,’ she told Bunkerspot. ‘We have our international ambition set and leadership within IMO and its member states to press on.’

Domestic policy impacts

Browne also believes that the maritime decarbonisation transition will continue on the US domestic stage, citing the ‘good amount of momentum in ports’ that came with substantial capital injections from programmes such as the Inflation Reduction Act during the Biden administration.

On 29 October, the US Environmental Protection Agency (EPA) allocated $3 billion for more than 50 projects aimed at improving and electrifying port infrastructure, in a bid to jump start and accelerate their climate efforts.

‘I am hopeful that it will be a good enough jumping off point to at least carry us through the Trump administration,’ Browne said, adding that she hopes the funds will be fully committed and allocated before the political transition takes place to ensure they aren’t clawed back.

‘We’re not likely to see that momentum carried by the Trump administration.’

Instead, Browne expects US climate leadership to come from the state level, notably California, but also from municipalities and ports through MOUs and bilateral agreements, for example. ‘It will again be the highest order of responsibility for US states to pick up the mantle to lead on climate action as we face all but certain backslides at the federal level.’

‘I am confident that this will happen, because I think it’s in all of their best interest, that is, for the triple bottom line of people, planet and profit, to do so.’

Adrian Tolson also argued that the Inflation Reduction Act, which has generated substantial investment in hydrogen and Sustainable Aviation Fuel (SAF), for instance, might continue to get support from the new administration ‘because there’s logic to it.’

Market volatility and the threat of a tariff war

However, Tolson highlighted that the election results bring significant uncertainty for the shipping and bunkering industries, given Donald Trump’s past declarations on tariffs and protectionist pledges.

This unpredictability about the next administration’s policy on global trade will impact not only stock markets, but also commodity markets, he explained.  

‘We’re going to have a massive period of volatility in the markets,’ he predicted, which might be an opportunity for the bunker industry to profit in the short term. ‘But at the same time, it doesn’t really help us in the long-term agenda,’ as the lack of regulatory certainty ‘just makes it very hard for shipping companies to make plans.’

While he believes much of Trump’s statements around tariffs are more akin to ‘negotiation positions’ than firm policy intention, he acknowledged that shipping would be impacted if a tariff war does happen and tariffs of up to 200% are imposed on Chinese exports to the US, for example.

‘I think that’s a bit unlikely, but if we had something like that, then it would obviously hurt international trade, so it would hurt shipping.’

In the immediate term, however, Tolson doesn’t anticipate major disruptions in the shipping and bunkering industries.

‘I think people are going to see what comes of it, see what the administration does. It’s certainly not going to speed investments that are in their way that haven’t been made already, but I don’t think it will discourage people from making those investments ultimately. But let’s see.’

Image: Shutterstock

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