Global Shipping’s Climate Deal Derailed: What the IMO Net Zero Framework Delay Means for the Industry

In October 2025, after years of negotiations, the world’s first global carbon pricing system for shipping was within reach—until the United States stepped in. The result? A one-year delay that has left the industry in limbo.

Why This Matters

Maritime shipping moves 90% of world trade and accounts for approximately 3% of global greenhouse gas emissions. For the first time, the International Maritime Organization (IMO) was poised to implement a landmark carbon pricing mechanism that would transform how the industry operates.

The IMO Net-Zero Framework (NZF) would have applied a $100 per tonne CO2 equivalent fee on vessels exceeding emission thresholds, fundamentally reshaping the economics of global shipping.

But on October 17, 2025, that progress stalled. The IMO voted to postpone adoption until October 2026—not due to technical challenges or industry concerns, but because of aggressive diplomatic pressure from the United States.

This isn’t just a story about politics. It’s about the future of global trade, the pace of decarbonization, and who gets to set the rules for one of the world’s most critical industries.

What Actually Happened

The Road to MEPC83

The IMO Net-Zero Framework emerged from years of negotiations at the Marine Environment Protection Committee (MEPC). Drafted at MEPC83 and initially scheduled for adoption at an extraordinary session in October 2025, the framework represented a historic breakthrough:

• $100 per tonne CO2 carbon price on shipping emissions
• Applies to vessels over 5,000 gross tonnage, covering 85% of shipping emissions
• Revenue recycling into just transition mechanisms for developing nations
• Bipartisan support from the EU, Japan, China, Britain, and—initially—the United States

According to reporting from Sustainability Magazine, the framework had “overwhelming support” from IMO member states, with approximately 60 island nations favoring a carbon levy and 16 emerging market economies supporting a trading system.

The Pressure Campaign

The second Trump administration changed everything.

According to reporting from Wikipedia and Safety4Sea, the US launched an extraordinary diplomatic offensive:

• Secretary of State Marco Rubio personally called officials in multiple countries threatening financial penalties
• Trump called the plan a “green scam” on Truth Social
• The US worked with Saudi Arabia to actively undermine the agreement
• Tariff threats were made against countries supporting the framework

The Guardian and other outlets reported that this pressure campaign was “extraordinary, even by the standards of the Trump administration’s combativeness.”

The Outcome

On October 17, 2025, the IMO voted to delay adoption for one year, reconvening in October 2026.

As Vela Law reported: “The session ended with the decision to adjourn for one year without adopting the measures and reconvene in October 2026.”

What Experts Are Saying

The reaction from industry and policy experts has been swift and polarized.

Industry Concerns

Shipping executives have expressed frustration with the uncertainty. The delay leaves operators unable to plan long-term investments in alternative fuels or efficiency upgrades. A report from Freight News noted: “International efforts to secure a global net-zero framework are expected to remain stalled until at least October 2026, but existing European Union regulation is already providing the shipping industry with a measure of certainty around investment.”

The European Union’s own Emissions Trading System (EU ETS), which entered full force in 2024, now represents the only binding carbon pricing mechanism for shipping—creating a patchwork regulatory environment that many argue favors European operators over global competitors.

Environmental Advocates

Environmental groups have been blunt in their criticism. The delay has been characterized as a significant setback for global climate efforts. The Just Transition Mechanism, designed to support developing nations during decarbonization, now faces an uncertain future.

Developing Nations Caught in the Middle

Perhaps most significantly, island nations and least-developed countries—many of which face disproportionate climate impacts despite contributing minimally to emissions—find themselves caught between global pressure and their own vulnerability.

Argentina and Norway had proposed exemptions for ports in Least-Developed Countries and Small Island Developing States. These equity concerns remain unresolved.

The Broader Implications

Economic Impacts

The $100 per tonne carbon price would have fundamentally altered shipping economics. Operators investing in LNG, methanol, or ammonia-powered vessels would have gained competitive advantages over those using traditional heavy fuel oil. The delay creates a “wait and see” environment that may slow capital allocation to cleaner technologies.

Geopolitical Ramifications

This episode signals a new era of climate diplomacy where economic power—rather than scientific consensus—may determine environmental outcomes. The US-Saudi coordination against the framework suggests oil-producing states and major consumers can effectively block international climate measures.

The European Pivot

With the IMO framework delayed, the EU ETS becomes the de facto global standard. This creates both opportunities and tensions:

• European operators benefit from regulatory clarity and competitive positioning
• Non-European carriers face higher compliance costs in EU waters
• Carbon leakage risks emerge if shipping routes shift to avoid EU regulations

Innovation Uncertainty

As Splash247 reported in their 2026 outlook, “Looking ahead to 2026, Lloyd highlights three developments set to shape daily operations. First among them is the shift toward alternative fuels.” The regulatory uncertainty complicates investment decisions that shipowners and charterers must make now for vessels that will operate for 20-30 years.

What Happens Next?

The fight is far from over. Here’s what to watch:

October 2026: The Next Vote

The IMO will reconvene in approximately 21 months. Whether a new US administration—or continued pressure—shapes the outcome remains uncertain.

Regional Regulations Accelerate

The EU ETS, FuelEU Maritime, and other regional measures will continue to reshape the landscape. Companies that wait for global harmonization may find themselves behind competitors who adapt to current requirements.

Legal Challenges

Legal experts suggest the US position may face challenges under existing international agreements, though enforcement mechanisms remain unclear.

Industry Self-Regulation

Some shipping companies may accelerate decarbonization efforts independently, recognizing that market forces and charterer demands may outpace regulatory timelines.

Questions That Remain

This story raises questions that deserve ongoing attention:

1. Can the IMO Net-Zero Framework survive another year of geopolitical pressure? Or will the delay become a permanent setback?
2. How will developing nations respond to being caught between great power politics and their own climate vulnerability?
3. What does this mean for the broader UN climate process? Is the IMO outcome a preview of COP negotiations?
4. Will shipping companies invest in cleaner technologies now despite regulatory uncertainty, or wait for clearer signals?
5. How will the EU’s unilateral approach affect global trade relationships and competitive dynamics?

The Bottom Line

The delay of the IMO Net-Zero Framework represents more than a scheduling change. It signals that even mature, technically feasible climate policies can fall victim to geopolitical maneuvering. For an industry responsible for 3% of global emissions—and growing—shipping decarbonization remains both urgent and uncertain.

What seems clear is this: whether through the IMO, regional regulations, or market forces, the shipping industry will eventually decarbonize. The question is not if but how, when, and at what cost.

The next 21 months will be critical in shaping those answers.