HUNGARY may have delayed the EU’s proposed maritime services ban, but that politically charged veto does not mean it is off the table.

Commission officials are pushing ahead with meetings to win over G7 partners to implement the ban as soon as is politically possible, and the UK has already confirmed that it is on board.

That may not go down well with Greece, Malta and Cyprus where governments are less enamoured by the idea of shunting all Russian cargoes from compliant tankers on to shadow fleet ships, but Brussels is adamant this will be pushed through.

While Baltic states have been shy about directly confronting shadow fleet tankers fearing Russian reprisals, they have been carefully collecting insurance certificates from passing ships for the past year.

The results prove that sanctions have pushed shadow fleet operators into the hands of a growing market of Russian insurers who are, on paper at least, providing cover to and increasingly Russian-flagged fleet.

This comes amid the emergence of alternative tanker vetting programmes, insulated from Western sanctions, and a growing market of new equivalents for class and maritime services built to supply the shadow fleet for the long haul.

While the rise of Russian insurance was known, the extent of it was previously a matter of guesswork.

Thanks to the Baltic coastal state surveys it is clear that Russia’s insurance providers are a growing force.

More than a third of oil tankers transiting the Baltic are now covered by Russian, or Russia-affiliated providers.

The problem is that in the event of their cover being called upon, nobody really knows how this all plays out.

India may be happy to officially recognise these new entrants to the P&I world, but the Baltic states understand that sanctions effectively leave their coastlines defenceless.

A large, capable insurance provider with a long history of experienced third-party marine liability insurance would struggle to put meaningful cover together while isolated from the traditional Western market. Most of those listed in the Danish data are not large providers.

Even once the Russian central bank has underwritten it, payments in the event of a spill would be impossible due to sanctions.

With the maritime services ban delayed for the moment, Russian oil exports retain access — directly or indirectly — to Western reinsurance.

Once the ban enters into force, the shadow fleet is effectively covered by Russia and coastal states will have to wait for the worst to happen before they can assess how effective that is in practice.

Richard Meade
Editor-in-chief, Lloyd’s List

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