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A mysterious fleet helps Russian President Vladimir Putin (70) transport oil around the world. In doing so, he circumvents the price cap for Russian oil imported by the EU, the G7 countries and Australia. Industry experts estimate the size of this shadow fleet at about 600 ships. That’s about 10 percent of the world’s large tankers, as reported by CNN. And the number continues to grow.
In response to the Russian attack on Ukraine, the EU bans the import of oil from Russia by sea. Because this shortage meant that an increase in oil prices on the international market had to be taken into account, the EU supplemented the measure with a price cap: countries such as China, India or Turkey, which do not comply with Western sanctions and continue to import from Russia, should pay no more than $60 per barrel. Technically, this is being implemented by allowing Western fleet managers to continue shipping Russian oil to third countries. However, the transport is only covered by the mostly Western insurers if the price ceiling is met.
Exports to China and India are reaching record highs
As a result, many Western companies withdrew from the transportation of Russian oil. At the same time, Russia is striving to stop cooperation with Western shippers. As a result, new opaque players emerged, in some cases with front companies in Dubai or Hong Kong. Some bought tankers from European companies, according to the CNN report, others use old vessels that might otherwise have ended up in the scrap heap.
According to data and analytics firm Kpler, Russian oil exports to China and India hit record highs in January. Exports to Turkey also continued to increase. As the world’s second-largest oil exporter, Russia, in its bid to keep going, has reshaped decades-old trade patterns and split the world’s transportation system in two. So says Richard Matthews, director of research at EA Gibson, an international freight forwarder. “You have the fleet that doesn’t do Russian business, and then there’s the fleet that almost exclusively does Russian business,” Matthews explains. Only a few ships, he adds, would do a little of both.
Security vulnerability warning
According to the CNN report, an executive of an oil trading company estimates that 25 to 35 ships are sold to the shadow fleet each month. The non-profit organization Global Witness believes that a quarter of oil tanker sales between the end of February 2022 and January of this year involved unknown buyers.
Matthews warns of a security vulnerability. The shadow fleet operators have “all these old ships that are probably not being maintained the way they should be,” says the shipping expert. “The probability of a major leak or accident is increasing day by day as the fleet grows.”
Source: Blick
I am Amelia James, a passionate journalist with a deep-rooted interest in current affairs. I have more than five years of experience in the media industry, working both as an author and editor for 24 Instant News. My main focus lies in international news, particularly regional conflicts and political issues around the world.
