US Russia shipping crackdown brings 35% of dark fleet under sanctions
Not only are individual ships sanctioned, but so too are their oil traders/charterers and marine insurers, piling pressure on the biggest buyers, refineries in China, India and Türkiye, and the banks that finance them
Of the 155 tankers today listed by the Office of Foreign Assets Control, 68 are part of the so-called dark fleet of elderly, anonymously owned ships solely deployed in lifting sanctioned oil from Russia
THE far-reaching sanctions crackdown announced by the US on Russia’s oil and shipping industry presents the greatest regulatory and trading challenge to those supporting the dark fleet* since it first evolved five years ago.
Of the 155 tankers today listed by the Office of Foreign Assets Control, 68 are part of the so-called dark fleet of elderly, anonymously owned ships, and solely deployed in lifting sanctioned oil from Russia.
The remainder are owned by Russian entities, including government-controlled shipowner Sovcomflot. This immediately sidelines vessels currently transporting 15% of Russian oil.
Not only are individual ships sanctioned, but so too are their oil traders/charterers and marine insurers, piling pressure on the biggest buyers, refineries in China, India and Türkiye, and the banks that finance them.
With today’s action, 35% of the 669 dark fleet tankers shipping Russian, Venezuelan and Iranian oil are now sanctioned by the US, UK or EU.
That figure is even higher for those deployed in shipping Russian crude, where the number is now likely to be between 40%-50%.
The shadow fleet designations were because a tanker was tracked “making a port call in a Russian port where oil has consistently traded above the $60 price cap”, or a related tanker managed by the same shipmanager.
That placed the shipmanager, operator or registered owner as “operating or having operated in the energy sector of the Russian federation economy”, the Treasury department said.
Western regulators have stepped up a coordinated campaign on Russia’s oil exports to enforce the price cap, and target revenues used to fund the war on Ukraine, with today’s listing of 183 ships on top of 90 announced last month by the EU and UK.
The G7 cap on Russian oil was imposed from December 2023, alongside import bans to Europe, the UK and US.
Under the cap, marine service providers including shipowners, oil traders, managers, insurers and banks can’t ship crude to third countries unless below the $60 per barrel price. A $100 per barrel cap for refined oil and $45 per barrel cap for fuel oil is also in place.
Most of the tankers loaded Russian oil from Arctic and eastern seaboard ports where grades have been priced well above the $60 per barrel cap in the past two years. Most of this crude is destined for China, the federation’s biggest buyer, or India.
Lower-priced Urals crude, which is shipped from Russia’s Baltic and Black Sea ports, trades at a discount to Brent crude, but infrequently dipped below $60 per barrel cap in past months.
Tankers engaged in shipping refined oil products including diesel, where global prices are well below the $100 per barrel cap, were not targeted.
Four beneficial owners or managers from what Ofac labelled the shadow fleet were named, including Hong Kong-based Prominent Shipmanagement Limited, Sunne Company Limited, Sino Ship Management Company Limited and Vietnam-based Sao Viet Petrol Transportation Company Limited.
One of Prominent Shipmanagement’s 10 tankers shipped oil above $60 per barrel so its entire fleet was designated, with Ofac noting that one ship, Samsun (IMO: 7725788), had also transported Iranian oil.
The same reason was given for the other shipmanagers, with the Treasury department noting four of the five tankers with Sao Viet Petrol Transportation previously shipped Iranian oil.
The success of this sweeping action will in part be determined by Chinese authorities, and whether they will continue to allow sanctioned tankers to enter their ports.
After short periods of inactivity most of the tankers designated by EU and UK regulators over 2024 continued to trade uninterrupted calling at ports in China and India.
But earlier this week, Shandong’s port authority said it was banning services for US-sanctioned vessels, a move viewed as a gamechanger for the province, where its privately run refineries are main buyers of oil from Russia, Iran and Venezuela.
Today’s move also triggers a further regulatory recalibration of dark fleet marine services providers. Many small and opportunistic registries have been lobbied over the past six months by western governments to deflag ships they designate.
This has increased the number of ships flying false or unknown flags, in response to regulatory pressure.
Thirty-two of today’s tankers were flagged with the UK-based Barbados registry, which claims it is the world’s fastest-growing. Barbados entered the Russian market in 2024 taking on ships kicked out by other registries after they were sanctioned, or those owned by Russia-controlled shipowner Sovcomflot.
In November, Barbados told Lloyd’s List it would deflag UK-sanctioned ships, but the registry said that it had yet to commit to doing so for vessels under US sanction.
Panama, the world’s second-largest registry committed to not flagging sanctioned tonnage in the final months of 2024.
Sixty of the 155 tankers named today by Ofac were flagged with Panama and will likely leave that country’s registry within two weeks, under laws that changed in August to fast-track tonnage removal.
Alongside pressure on flags including Gabon, Cook Islands and Cameroon to discontinue providing services to listed tankers, the number of ships flying false flags by using fake registries or continuing to fraudulently broadcast under their prior registry gained.
This limits their trading to ship-to-ship transfers and floating storage in most cases.
Some 15% of the dark fleet are now flying false or unknown flags, more than all other registries except for Panama.
* Lloyd’s List defines a tanker as part of the dark fleet if it is aged 15 years or over, anonymously owned and/or has a corporate structure designed to obfuscate beneficial ownership discovery, solely deployed in sanctioned oil trades, and engaged in one or more of the deceptive shipping practices outlined in US State Department guidance issued in May 2020. The figures exclude tankers tracked to government-controlled shipping entities such as Russia’s Sovcomflot, or Iran’s National Iranian Tanker Co, and those already sanctioned.
Download our explainer on the different risk profiles of the dark fleet here
