The United States Merchant Marine’s system of sleeve insignia and devices is based upon the one used by the United States Maritime Service (USMS), the organization tasked with the official oversight of training Merchant Mariners. When the Maritime Service was established through the Merchant Marine Act of 1936, the legislation mandated that its personnel would use the same “ranks, grades, and ratings as…the United States Coast Guard.”
So for its Engineer Officers, the USMS chose a three-bladed propeller, a design first used by the United States Navy for Chief Warrant Officer Machinists (1900). It was adopted for the Oiler rating by the United States Revenue Cutter service in 1908 and was retained when the Oiler rating became the Motor Machinist’s Mate. A gold version is still worn by CWO Engineering Technicians in the United States Navy.
Personnel actually serving in the USMS, as opposed to the United States Merchant Marine, wear wreathed versions of devices such as the Engineer’s propeller. Actual uniform policies vary between vessels in the Merchant Marine based upon company policy; some Merchant Marine vessels company policy may not require its Engineer Officers to wear a rank or branch-of-service device.