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Russia’s shadow, or ghost, fleet was refocusing on Friday after Western sanctions hit its vital oil sector.
Since Russia invaded Ukraine in February 2022, the number of oil tankers with unclear ownership or adequate insurance has increased, allowing Moscow to continue exporting its crude oil.
The United States and Britain on Friday announced sanctions against Russia’s energy sector, including oil giant Gazprom Neft.
The United States has sanctioned more than 180 ships, as well as Russian oil companies Gazprom Neft and Sergtneftigas.
Britain also announced sanctions against the two companies.
“Efforts by Western governments to reduce the shadow fleet through sanctions on individual vessels have been only marginally effective,” the US think tank Atlantic Council said in a December report.
What is Ghost Fleet?
The Kyiv School of Economics (KSE) defines a ghost fleet as commercial vessels that are neither owned by countries in the G7 alliance with the European Union, or that are protected and Do not use indemnity (P&I) insurance.
Such ships, also known as “dark fleets”, are also used by Iran and Venezuela to circumvent US sanctions.
According to the Atlantic Council, since Russia’s invasion of Ukraine nearly three years ago, “the shadow fleet — which previously carried supplies mostly from Iran and Venezuela — has exploded in size.”
It estimates that about 17 percent of all oil tankers currently belong to the shadow fleet, which includes other commercial vessels.
KSE noted on Friday that in November, Russian oil export earnings fell by $1.1 billion to $14.6 billion due to lower prices and export volumes.
At the same time, “greater coordination between jurisdictions is needed to strengthen sanctions enforcement and close loopholes, which would make it difficult for Russia to sustain shadow fleet operations”.
The dangers of the ghost fleet?
Before Friday’s events, Russia had been banned from providing oil shipping services by sea to curb the oil embargo, cap the price of its crude oil and stop financing its war with Ukraine.
To get around them, Moscow had to reduce its dependence on Western maritime services by buying tankers and providing its own insurance.
None of the ships in the Russian ghost fleet have adequate P&I insurance — a requirement for commercial vessels to cover risks from war, collision or environmental damage such as oil spills.
Up to 95 percent of the P&I insurance market is made up of insurers from the European Union and the United Kingdom, both of which have imposed sanctions on Russia several times since the start of the war.
For the Atlantic Council, the Shadow Fleet is a non-military but powerful weapon because Ukrainian backers will pay the price in the event of an accident or oil spill at sea with a Western ship.
(Other than the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
