Russia's shadow fleet: environmental concerns demand fresh sanctions

For example, in 2023, not a single tanker was scrapped globally. However, the use of old vessels has its own logic.

Tankers that violate sanctions risk being noticed by the U.S. Office of Foreign Assets Control, which imposes sanctions and may restrict their use. There is even a possibility that the owner will be forced to scrap the vessel. Therefore, there is a risk of losing the vessel, and shadow fleet operators prefer older tankers, which have a lower price and will incur less loss in case of confiscation. Additionally, old tankers that were supposed to be scrapped are, in fact, the only way to quickly assemble a large number of ships for the shadow fleet.

The use of outdated and worn-out vessels increases the risk of accidents and the danger of oil spills, which are always a major environmental concern. What will happen if these vessels cause a significant number of such environmental incidents? And who will pay for the consequences?

Read also: Sanctions against Russia's shadow fleet: underway, but insufficient

For example, two-thirds of Russian tankers passing through the Danish Straits do not have insurance coverage for damages. Global insurers are based in Western countries and are subject to Western sanctions, so these shadowy vessels turn to alternative insurance (including Russian companies like Ingosstrakh), which is often completely inadequate. Frequently, the contracts are written in such a way that it is nearly impossible to hold the owner or operator of the vessel accountable. In this case, the countries that are directly affected will bear the responsibility for covering the losses. In other words, these are not genuine insurance contracts, but sheer fraud.

A recent report by Greenpeace notes that the number of oil tankers leaving Russian ports in the Baltic Sea (Primorsk, St. Petersburg, Ust-Luga, and Vysotsk) and passing the German Baltic coast is now 70% higher than before the full-scale war. Last year, about a thousand tankers with Russian oil passed by the German coast, marking the highest number on record.

At the same time, these tankers are almost twice as old as those that used this route before the war, and they are in poor condition, poorly maintained, and rarely inspected. The average age of tankers is now 16.6 years, compared to 8.9 years before the full-scale war.

Consequently, since the beginning of the war, there has been a greater number of vessel passages that are less reliable in terms of operational safety and environmental risks. For example, on August 22, two of the three tankers passing along the German coast were uninsured. They were 17, 18, and 20 years old. One of them, the Chilli, had been repeatedly cited during port inspections. Last July, Indian port inspectors noted corrosion on the ship's hull. In March, inspectors at the Indian port of Sikka found at least six faults on the Chilli and detained it.

European countries that deal with the scrap metal of Russia's shadow fleet should be concerned about the risks of oil spills. The potential for environmental disasters should be a key argument in communications with the West to increase pressure on the Russian shadow fleet.

In June, Danish Foreign Minister Lars Løkke Rasmussen stated that Denmark and several other Western countries are considering ways to limit, if not completely stop, the dangerous movement of Russia's shadow fleet through the only exit from the Baltic Sea. This could involve using certain rights of coastal states to prevent environmental damage.

Commercial shipping through the Danish straits is protected under international law - the Copenhagen Convention of 1857 guarantees the right of innocent passage for commercial ships. However, this raises the question: to what extent is the movement of the Russian shadow fleet peaceful? It’s important to note that Russian oil revenues obtained by circumventing sanctions are a significant source of funding for the Russian budget, and thus for the war against Ukraine.

Additionally, we must consider how significant the environmental risks associated with possible oil spills are and how they compare to security concerns. International law, particularly the 1982 United Nations Convention on the Law of the Sea, grants coastal states the right to take action against ships that pose an environmental threat.

If some countries are hesitant to take adequate measures to restrict the activities of the Russian shadow fleet, then the environmental risks of using outdated vessels to transport Russian oil in violation of sanctions should be emphasized further.

Source

About the author. Andrian Prokip, energy analyst at the Ukrainian Institute for the Future.

The editors don't always share the opinions expressed by the blog authors.