Retaliation Warning: U.S. to Counter Emission Fees on Ships

The United States has formally pulled out of current global negotiations meant to promote decarbonisation attempts in international shipping. The talks, conducted at the International Maritime Organization (IMO) headquarters in London, are part of larger initiatives aimed at lowering greenhouse gas (GHG) emissions and driving the shipping sector to net-zero carbon emissions by about 2050. The U.S., though, has remained adamant against taking any economic steps or charges that would put its ships at a financial cost depending on fuel consumption or emission levels.

As stated in a diplomatic note that Reuters has seen, the U.S. administration advised other countries that it will not attend the IMO's third Marine Environment Protection Committee meeting, to be held April 7–11, 2025. The note cited that Washington does not agree with all economic sanctions that would emanate from the proposals now under consideration, including a carbon charge proposed by a group of countries led by the European Union. The planned levy is the first of its kind and is intended to charge a fee for carbon emissions by international shipping fleets as a measure to reduce pollution and promote cleaner energy shifts.

The U.S. State Department confirmed that the nation would not be participating in the ongoing round of negotiations due to its policy of putting national interests first before joining international agreements. The U.S. also cautioned that if any such steps were taken against its shipping fleet, it would think in terms of reciprocal measures to counter the economic costs and serve American economic interests. In addition, the U.S. took exception to spending any funds gathered for environmental schemes outside the shipping sector, maintaining that such action would be an overstepping of maritime regulation.

In spite of the U.S. withdrawal, the IMO talks went ahead on schedule. Envoys of other member countries, including island nations and eco-activists, insisted that they remain on course and with countries that wanted to continue discussing. The IMO has 176 member states and although the United States wields considerable influence, it is by no means alone in shaping the world's sea policy. Most stakeholders are convinced the organization needs to keep pushing towards an international climate strategy for shipping, particularly since the industry is already responsible for approximately 3% of global CO₂ emissions and carries approximately 90% of world trade.

Concurrently, other nations such as China and Brazil also expressed their opposition to the suggested flat carbon levy. The countries believe that the policy might disproportionately impact developing economies that are reliant on oceanic trade. Their concern is the economic burden that such levies could impose on developing nations, further complicating existing global trade and climate dynamics.

This follows closely on the heels of U.S. President Donald Trump's announcement of a second withdrawal from the Paris Climate Agreement in January 2025, further singling out the nation from significant global climate initiatives. Walking away from the IMO talks is considered an extension of the administration's overall approach to favoring economic and trade interests over global climate cooperation.

The U.S. action underscores deep-seated tensions in international climate diplomacy, particularly over how the costs and responsibilities are to be shared. For shipping, long in the crosshairs of eco-groups and institutional investors, the lack of participation by a key player such as the U.S. might slow agreement on much-needed climate action. Yet most nations remain determined to move ahead with decarbonisation plans, with or without complete U.S. engagement.

As the IMO meetings continue, it is unclear how the U.S. absence will affect the final decisions. The talks are likely to determine the future regulation of shipping industry emissions, so they are important for global climate goals. If a carbon tax or other emissions control measure is agreed, it could still be difficult to implement without support from major players such as the U.S.

Source/Credits:
Reuters, Reporting by Jonathan Saul, Michelle Nichols, Gram Slattery, Kate Abnett and Valerie Volcovici; Editing by Sharon Singleton, Chizu Nomiyama and Nia Williams