This week the EU Parliament published (click here) a briefing regarding a resolution passed by MEPs demanding more targeted EU sanctions against Russia’s ‘shadow fleet’ – a colloquial name given to a collection of old oil tankers, often uninsured and with unclear ownership, to export its crude oil and petroleum products despite EU, G7 and international sanctions placing several restrictions on this activity. The eight-page resolution may be found here.
Key elements of the resolution are summarised as follows:
- The use of old vessels have raised fears over the risk of environmental disasters, including severe oil spills;
- The shadow fleet undermines EU restrictive sanctions thereby providing a key financial lifeline to Russia;
- The resolution calls for more targeted measures against vessels in the shadow fleet in the next EU sanctions packages;
- These measures should target all individual ships, their owners, operators, managers, accounts, banks and insurance companies;
- The measures should include the systematic sanctioning of vessels sailing through EU waters without proper insurance;
- The resolution urges the EU to enhance its surveillance capabilities, especially drone and satellite monitoring, and to conduct targeted inspections at sea;
- The resolution calls on G7 countries to better enforce the price cap imposed on Russian seaborne oil, to substantially decrease the level of the oil price cap and to crack down on loopholes used by Russia to repackage and sell its oil and oil products at full market prices;
- The resolution implores the EU to reassess its bilateral cooperation with third countries that are helping Russia to circumvent EU restrictive measures if diplomatic efforts are unsuccessful;
- MEPs urge the EU and its member states to ban all imports of Russian fossil fuels, including Liquified Natural Gas (LNG), pointing towards the need for the much stricter enforcement of current EU sanctions;
- The MEPs want EU member states to designate ports capable of handling sanctioned vessels carrying crude oil and LNG, and be given the ability to seize illegal cargo without compensation.
Many western shippers have started to return to the Russian market now that the price of Russian Urals crude has fallen below the G7+ price cap of USD $60/barrel. It remains to be seen whether harsher measures from the G7+ group will emerge as a result.
