When it comes to Marine insurance knowing which territory a vessel is registered to, where the crew are from and what is being carried are all vital pieces of any insurance jigsaw. But there are dark, or shadow fleet ships out on the oceans, carrying cargo that isn’t on the manifest. It’s a serious issue and Pole Star Global offer some insights below;
The European Union (EU) has unveiled its largest ever shadow fleet sanctions package, blacklisting 189 additional Russian-linked tankers and bringing the total number of sanctioned vessels to 342.
However, analysis from Pole Star Global, the leader in maritime intelligence and regulatory compliance solutions, shows that the EU’s package still leaves more than half of the known Dark Fleet untouched. This is despite clear links to sanctions evasion, breaches of the G7 oil price cap, and also its related insurance/compliance ramifications. Pole Star’s Deep Blue Intelligence (DBI) data platform has already identified hundreds of additional vessels and companies operating in the same manner as those just sanctioned.
David Tannenbaum, Partner, Sanctions & Maritime Intelligence at Pole Star Global, Pole Star Global, offers the following analysis:
“These sanctions are a significant escalation by the E.U. to target Russia’s Dark Fleet, including not just the vessels but also the companies that support the fleet, keeping it insured, chartered, and operational. But despite the scope, this action still misses a large portion of Russia’s Dark Fleet already identified by DBI.
“For example, while the E.U. designated Cape Gemi Isletmeciligi AS (‘Cape Gemi’), a front company for Beks Denizcilik ve Ticaret (Beks), and Prominent Shipmanagement – both detailed in our case study on Major Russian Dark Fleet actors last September – only 21 of the 41 tankers operated by these two fleets were sanctioned, despite all of them engaging in the same activity. Additionally, only one of Beks’ front companies was named, even though Beks continues to operate two others, all registered at the same address.
“In our report, DBI identified 266 tankers operated by eight major fleets suspected of price cap evasion or other Dark Fleet activity. Yet, even with this latest 17th sanctions package against Russia, the EU has only designated 89 of them – just 33%. If we exclude one fleet that primarily deals with Iranian crude, that number only rises to 43%.
“A fair number of the vessels targeted by today’s designation fit a previously identified typology of using special purpose vehicles (SPVs) incorporated in the Seychelles to manage vessels on behalf of Azerbaijani or Moldovan groups. As we like to say during training, you can’t say Seychelles without saying ‘shell’”
“The E.U. also sanctioned several key Russian entities involved in the purchase and transport of crude oil outside the price cap, including Volgo Shipping, Eiger Shipping DMCC (Litasco’s chartering arm), Surneftegaz, and another Sovcomflot shell company, Avebury Shipping – all of which have been tracked by DBI.
“The E.U. also sanctioned VSK Insurance Joint Stock Company (“VSK”). This is also a strong signal that the E.U., like the U.K., is willing to go after high-risk P&I providers. Although it’s already under U.K. sanctions, this new designation aligns EU enforcement with U.K. efforts. VSK is reinsured by the Russian National Reinsurance Company (RNRC), which is already sanctioned by all Coalition members – adding yet additional sanctions risks in dealing with Dark Fleet operators insured by VSK or other Russian P&I Clubs. DBI has identified 366 vessels insured or suspected to be insured by VSK, and we’ve long warned the industry of the risks posed by sanctioned or dodgy P&I clubs.
“In fact, we’ve identified nearly 1,500 vessels globally that are insured by high-risk P&I providers, including other Russian insurance companies.”
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