Scorpio Tankers Ready to Sting as Shipping Faces Fuel Restrictions
In an age of 3D printing, drones and overnight delivery, transporting goods slowly by water seems antiquated. And yet shipping accounts for 90% of world trade, carrying raw materials, food and manufactured goods across oceans to make a global economy possible.
The 60,000 ships in the world's merchant fleets are among the biggest polluters on the planet, with a single large ship emitting as much sulfur dioxide as 50 million diesel cars. To mitigate that situation, the International Maritime Organisation in 2016 ordered ships to reduce the amount of sulfur in their fuel from 3.5% to 0.5% with a deadline of Jan. 1, 2020.
It is a massive shift that will ripple through the entire energy industry, affecting low-sulfur fuel refiners like Valero Energy and Marathon Petroleum but also tanker companies like Frontline and Scorpio Tankers (NYSE: STNG). Frontline is the largest oil tanker operator in the world, but focuses on crude transport while Scorpio is the largest operator of product tankers, making it a pure play for the increase in refinery products.
Source Fool.com
