Figuratively speaking, oil is the lifeblood of the Russian economy. The economic sanctions imposed by the West were designed to bleed the aggressor country. It is common knowledge that the European Union has banned sea transportation of Russian oil and oil products to non-EU countries from December 2022. A ban on the provision of related technical, brokerage and financial services was also introduced.
The US has imposed sanctions on Russian tanker companies, including Sovcomflot, freezing their assets in the US and banning Americans from doing business with them. In addition, the G7 countries, the EU and Australia have set a price ceiling on Russian oil of $60 per barrel, which prohibits the use of Western maritime services to transport oil if the price exceeds this maximum.
The shadow fleet is at the service of the aggressor country
But Russia actively and resourcefully circumvents these bans. According to Greenpeace, since July of this year, about 15 tankers with Russian oil have arrived at European ports, violating the ban on shipments that has been in effect since last March. Most of these ships belong to Greek companies, which are suspected of participating in the “shadow fleet” of Russia. After arriving at the designated ports, the cargo was shipped, which is evidenced by the decrease in draft of the tankers.
Russia was able to increase its shadow tanker fleet by acquiring 35 new tankers despite the sanctions. In July of this year, 4/5 of Russian crude oil and almost half of oil products were transported by these shadow tankers, of which only a third was insured by well-known international insurers.
Obviously, this undermines the global mechanisms of price control and trade. The shadow fleet’s arsenal, like the artillery arsenal Russia inherited from the Union, consists of outdated and derelict vessels with dubious ownership structures and a lack of insurance, increasing the risk of oil spills. Despite the new requirements to prevent the sale of tankers in the Russian shadow sphere, introduced by the European Union, the problem remains acute.
The Northern Sea Route is a new way for an aggressor country to resume hydrocarbon trade
This year, Russia sent record volume of oil through its Arctic Circle waters, speeding up shipping to China in an environmentally sensitive area.
This year, at least 15 oil tankers carrying about 10.7 million barrels of crude oil used the Northern Sea Route, a passage along the northern coast of Russia. This compares with a combined number of 14 vessels that transported 10.5 million barrels during last year’s navigation season. Three tankers have already passed this route once and are standing empty near the port of Murmansk, two more should arrive in the next few days. This could increase this year’s shipments to more than 14.4 million barrels.
The 2,500-mile navigable route, which passes through the waters near the Siberian tundra, is normally only used in the summer. But Western sanctions and Houthi drone attacks in the Red Sea have boosted its appeal as the shortest transit between Russian and Chinese ports.
According to the Russian energy company Rosatom, which also manages the Northern Sea Route, last year a record 36 million tons of cargo was transported along this route, more than half of which was liquefied natural gas.
Traveling can be difficult now, especially if you need the help of an icebreaker. In just a month, the waters will become icy and dangerous for transit. Paradoxically, attacks by the Yemeni Houthis in the Red Sea have made the Northern Sea Route more attractive to Russian tankers, as this route allows to avoid conflict zones and deliver goods to customers faster.
The tanker “Sturman Ovtsyn” was the first to use this route this year and has already completed half of the route. It usually transports cargo from the Gulf of Ob to Murmansk, but this time it is heading to the Chinese port of Rizhao for maintenance and unloading.
Two more tankers, “Prospekt Korolev” and “Prospekt Vernadskyi”, are heading from China to Murmansk through the Bering Strait. They will be modernized in Murmansk before the start of new work under the Sakhalin-2 project.
Using this route can halve the time it takes to transport goods from Baltic Sea ports to buyers in the Middle East. Time saving is even greater for shipments from Arctic terminals to Murmansk.
It usually takes just over a week to cross the northern coast from Novaya Zemlya to the Bering Strait. From there, it takes up to two weeks to reach ports around Shanghai or northern China. This is significantly faster than the trip from the Baltic to Shanghai via the Suez Canal, which takes about a month and a half, or 50 days from Murmansk.
The 2024 Northern Sea Route navigation season was scheduled to run from July 1 to the end of November, but was cut short due to early ice formation due to large amounts of residual ice. This will close the route to non-ice-class vessels from October 15 and to all but the strongest ice-breaking tankers until early November.
Most of the vessels using this route are relatively modern and belong to the Russian shipping giant Sovcomflot. This year, however, several older vessels that are part of a shadow fleet of tankers created to circumvent Western sanctions on the transport of Russian oil have also made the trip.
Almost half of the vessels using the Northern Sea Route this year are at least 15 years old, compared with about a third of tankers using the route last year.
What ecological danger do oil tankers create?
Large tankers can carry over 150 million liters of oil each. The average age of oil-carrying vessels increased from 8.9 years in 2021 to 16.6 years in 2024. This poses a serious environmental threat, as the accident could lead to large-scale oil spills in European waters, in particular on the Fehmarn Islands and Baltic Sea resorts such as Warnemünde and Damp.
Increased tanker traffic through the Arctic may also increase environmental risks, given the vulnerability of the Arctic ecosystem. “The remoteness, lack of infrastructure and adverse environmental conditions in the Arctic mean that significant logistical and operational challenges must be overcome in the event of an oil spill”, – stated International Federation of Pollution Tanker Owners. It is a non-profit organization created on behalf of the world’s shipowners to prevent marine spills of oil, chemicals and other toxic substances.
Tanker transportation as an alternative to traditional oil logistics
So, it is obvious that Russia has decided to expand tanker transportation, firstly, because Western sanctions have limited its ability to export oil through traditional routes. The expansion of the tanker fleet allows Russia to bypass these restrictions and continue to supply oil to world markets and increase its income from oil exports to further finance aggression in Ukraine. Unfortunately, control over the supply of energy resources allows Russia to maintain influence in the global energy market and use fuel as a tool of geopolitical pressure in today’s bipolar world.
Tatyana Morarash
