US sanctions maritime firms and vessels for shipping Russian crude above price cap

The US Treasury’s Office of Foreign Assets Control (OFAC) has imposed sanctions on three shipping firms based in the UAE and three vessels owned by them for shipping Russian oil above the G7's price cap. PHOTO: Oil barrels in the colors of the Russian flag. Getty Images

The sanctions were imposed because the vessels were found to be transporting Russian crude oil priced higher than the price cap of $60/bbl. The vessels also used services provided by US individuals while transporting crude oil of Russian origin, the department stated in a statement.

Last year, the US, along with other G7 countries and the “non-enumerated member” EU and Australia imposed a cap on seaborne oil exports from Russia. The intention was to reduce Russia's oil revenues as a form of sanction for its invasion of Ukraine.

The sanctions were imposed on Kazan Shipping, Progress Shipping, and Gallion Navigation, along with their tanker vessels Kazan, Ligovsky Prospect and NS Century.

According to VesselFinder AIS data, the Ligovsky Prospect is currently located near Malacca Strait after it made its port call in Singapore last month. Kazan was last located near Hong Kong, and NS Century is expected to arrive at Vadinar, India on 25 November after departing from Yeosu, Korea.

“Shipping companies and vessels participating in the Russian oil trade while using Price Cap Coalition service providers should fully understand that we will hold them accountable for compliance,” US' Deputy Treasury Secretary Wally Adeyemo said in the statement.

The price cap was intended to limit Russia's crude oil revenue, but due to strong global oil prices, Russia has been using shadow tankers to transport oil and trade much of it above the cap. A shadow fleet or a “dark fleet” primarily consists of older and environmentally hazardous vessels that intentionally evade regulations. These ships are said to operate under the radar, by sailing without insurance or disabling their tracking transmitters.

By Debarati Bhattacharjee

Please get in touch with comments or additional info to news@engine.online