What keeps chemical and product tanker owners awake at night

An industry poll* has revealed widespread concerns about decarbonisation, rising costs, regulatory compliance and technological advancements.

Decarbonisation and alternative fuels

The quest for sustainable energy solutions is at the forefront of industry concerns.

One poll respondent asked, "Is there any other solution except nuclear? We need a huge amount of power to create green fuels."

The feasibility of nuclear energy is just one of the options being explored, while the scalability and ethical considerations of biofuels add layers of complexity. Respondents felt the adoption of alternative fuels such as LNG and methanol is being hindered by infrastructure readiness and the challenge of cost-sharing with charterers.

Rising costs and market pressures

Skyrocketing shipbuilding costs and constrained yard capacity were frequently cited as critical issues.

As one participant noted, "There is high demand for new vessels. How are you expecting the prices to be reduced? Shipyards are planning to further increase their prices."

Discussions also touched on the industry’s heavy reliance on Asian yards and the potential for diversification into European and Middle Eastern regions.

The financial feasibility of ESG-linked initiatives and the likelihood of sector consolidation due to FuelEU Maritime regulations add to the economic pressures.

Regulatory and compliance challenges

The evolving regulatory landscape continues to weigh heavily on chemical and product tanker owners.

The impact of the EU Emissions Trading System (ETS) and global greenhouse gas (GHG) reduction strategies on competitiveness was a recurring theme. Many expressed concerns about aligning regional and global regulations and the implications of the Carbon Intensity Indicator (CII) and mid-term measures on smaller fleets.

One respondent questioned whether these frameworks adequately address the complexities of implementation, asking, "How does IMO’s GHG reduction strategy align with regional measures like the EU ETS and FuelEU Maritime?"

Operational and technological innovation

Advances in operational technology offer promise, but adoption remains inconsistent. Respondents highlighted the role of data analytics and AI in improving safety, emissions tracking and market efficiency.

Tank cleaning practices also drew attention, with new technologies promising greater environmental compliance. Yet, resistance from charterers toward adopting shorter tank cleaning cycles persists.

One participant asked, "If the science is as compelling as you suggest, what are the charterers’ justifications for their continued insistence on wall wash requirements?"

Workforce and training needs

The poll revealed an urgent need for workforce readiness as alternative fuels such as methanol and LNG gain traction. Training seafarers on these fuels, along with setting realistic regulatory timelines, was viewed as essential.

"What targets should be set for the proportion of seafarers trained on these fuels by 2030?" one respondent queried.

Poll insights

The results pointed to a deep scepticism about the effectiveness of existing measures to facilitate alternative fuel adoption. Many participants called for clearer global guidelines and emphasised the importance of industry collaboration in navigating this complex landscape.

The 2024 poll highlights the chemical and product tanker industry at a crossroads, grappling with the dual pressures of meeting environmental goals while maintaining economic viability.

As one respondent succinctly put it, "The balance between compliance and competitiveness will define the future of chemical and product tankers."