Russia’s shadow, or ghost, fleet came into focus again on Friday as the country was hit by Western sanctions on its key oil sector.
Since Russia invaded Ukraine in February 2022, the number of oil tankers with opaque ownership or without proper insurance has increased, allowing Moscow to continue exporting its crude.
The United States and Britain on Friday announced sanctions against Russia’s energy sector, including oil giant Gazprom Neft.
The US designated more than 180 ships as well as Russian oil companies Gazprom Neft and Surgutneftegas as subject to sanctions.
Britain also announced sanctions against both companies.
“Efforts by Western governments to reduce shadow fleets through restrictions on individual vessels have been only moderately 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 ships that are neither owned by countries in the G7 alliance with the EU, or that do not use protection and indemnity (P&I) insurance. We do.
Such ships, also known as the “Dark Fleet”, are used by Iran and Venezuela to evade US sanctions.
According to the Atlantic Council, since Russia’s invasion of Ukraine nearly three years ago, “the shadow fleet – which previously carried cargo 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 also includes other merchant vessels.
KSE noted on Friday that in November, Russian oil export revenues fell by $1.1 billion to $14.6 billion due to lower prices and export volumes.
At the same time, “greater coordination is needed between jurisdictions to enforce sanctions and close loopholes that would make it harder for Russia to maintain shadow fleet operations”.
Ghost Fleet Risks?
Before Friday’s events, Russia had been hit with an oil embargo, placing price limits on its crude and banning it from providing services to ship oil via sea to prevent financing a war with Ukraine. Was given.
To avoid them, Moscow has had to reduce its dependence on Western maritime services by purchasing tankers and providing its own insurance.
None of the ships in the Russian ghost fleet have adequate P&I insurance – this is required for commercial ships to cover the risk of environmental damage such as war, collision or oil spill.
Up to 95 percent of the P&I insurance market is made up of insurers from the EU and the UK, both of which have imposed several rounds of sanctions on Russia since the start of the war.
For the Atlantic Council, the shadow fleet is a non-military but powerful weapon because of the costs to Ukraine’s supporters in the event of an accident at sea with a Western ship or an oil spill.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
