The main news of the current sanctioning cycle is the European Commission's proposal to extend restrictions to the port of Kulevi in Georgia and the port of Karimun in Indonesia. It must be acknowledged that the choice of these locations is well-founded. Kulevi is a significant terminal for the transshipment of petroleum products in the Black Sea, which Ukraine finds somewhat challenging to attack. Meanwhile, Karimun has long established itself as a key hub for Ship-to-Ship operations in Southeast Asia. Reports indicate that mixing different grades of oil and transshipment activities, aimed at concealing the true origin of the crude, occur there away from the watchful eyes of European regulators.
In addition to the infrastructure, the lists are set to include another 42 tankers, confirming the scale of the "inventory" in the shadow sector.
Beneath the quantitative figures lies a qualitative change in the sanctions tactics. Brussels has realized that simply blocking vessels is not very effective: VG has already thoroughly examined cases where tankers, following exclusion from classification societies or loss of insurance, simply changed their name, ownership, and flag, continuing operations through offshore chains. Now, the EU is targeting financial schemes—sanctions are aimed at banks in Tajikistan, Laos, and Kyrgyzstan that facilitated transactions circumventing Western systems.
The daily operations of the shadow fleet in recent years resemble an endless series with constant changes in scenery. Under pressure from secondary sanctions, Barbados and Panama have begun to massively revoke flags from vessels suspected of transporting Russian oil. This has prompted a migration of the fleet to the jurisdictions of Gabon or the Comoros Islands but has not halted the flow. The "gray" fleet possesses a phenomenal ability for regeneration: for every liquidated operating company, such as the Indian Gatik, several less noticeable structures spring up in its place.
The new EU initiative aims to deprive these vessels of basic operational support. Restrictions on bunkering, repairs, and any technical maintenance in ports seek to push the "shadowers" into a state of complete autonomy, which is technically impossible for aging vessels that make up the backbone of the gray fleet.
"Sanctions against the shadow fleet are not fundamentally new: after all, both the EU and the UK have repeatedly imposed restrictions on tankers transporting Russian oil.
Much greater danger is posed by restrictions on servicing shadow fleet vessels in any EU seaports.
This includes not only insurance services but any other operations, from transshipping oil in the territorial waters of EU countries to port calls in seaports. "Second-tier" restrictions could complicate export logistics, thereby increasing the costs of exporting oil and petroleum products," reported VG Sergey Tereshkin, CEO of Open Oil Market.
Despite the resolute tone of the European Commission, a lack of unity is evident within the EU itself. Greece and Malta—countries with substantial commercial fleets—have already spoken out against the ban on transportation services for oil from Russia. For Athens, maritime shipping is not only a source of revenue for the budget but also a lever of influence in the global division of labor. Restrictions on Greek tankers dealing with Russian raw materials would automatically hand the market over to Asian or Middle Eastern players, which does not bode well for Mediterranean ship owners.
"Brussels is attempting to impose political rules on a market that, by its nature, is global and anarchic. We see that even with tough measures, loopholes remain. The removal of sanctions from two Chinese banks amid pressure on Central Asian banks is a clear bow to Beijing. It is an acknowledgment that without China's involvement, any attempt at a financial blockade on maritime exports becomes a fiction," notes a source within the maritime trade sector.
Indeed, the selectivity of the sanctions highlights their political underpinnings. By punishing the ports of Georgia and Indonesia, the EU seeks to create a precedent that will make other neutral ports consider the risks. However, logistics always seeks the path of least resistance. Increased freight costs and rising insurance premiums are factored into the end price, and discounts on raw materials help offset these expenses.
The maritime sector is entering a period of final fragmentation. The EU's efforts to block ports in third countries and expand lists of tankers will not lead to an instant halt of exports, but they seek to radically alter its economics.
We are witnessing the formation of "parallel" port infrastructure and financial frameworks that operate beyond the reach of Western law.
If the 20th package is adopted in such a decisive form, it will accelerate the aging process of the global fleet (as new vessels will avoid toxic routes) and lead to further increases in logistical complexities. For Russian exports, this means an inevitable rise in transportation costs and the necessity for investments in its own port infrastructure in friendly regions.
In reality, the anniversary sanctions package risks becoming a "final warning." The effectiveness of these sanctions has taken on a more public relations character than economic weight. Behind harsh rhetoric lies neither unity within the EU, nor unequivocal mass support from voters, nor a mechanism for comprehensive monitoring of sanction compliance. The diminishing influence of once-powerful European nations reduces the risks associated with non-compliance with rules imposed by them. As experience from America shows, to demand compliance, one must send an aircraft carrier group. And there are no gunboats for all dissenters.
Source: Vgudok
