What looks to be an obscure regulation aimed at the international marine shipping industry could seriously affect the economy, boosting the price of airline tickets and diesel at the pump.
The change affects large ships, which use a low grade of fuel that's considered the bottom of the barrel because of its air pollution.
The International Maritime Organization is introducing a sulphur limit rule for 2020, known as IMO 2020, which will decrease the amount of sulfur allowed in the fuel from 3.5% to 0.5%.
To facilitate compliance, experts say many ships will likely switch to diesel, which could lead to the strongest-ever demand for the fuel.
That increase could spur widespread inflation, since the shipping industry relies on diesel to move products and materials by boat, train and truck.
The airline industry is not expected to be immune, since diesel and jet fuel of are of a similar grade and traditionally sell for a similar value. If diesel prices spike, so too will jet fuel.
Jet fuel prices have soared in recent years, rising about 45% since the start of 2017. Air Canada and WestJet have raised ticket prices as a result. Some airlines in North America have already voiced concerns about the negative impact on the industry.
