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HomeAsian NewsThe tanker fallout from impending Russian insurance coverage ban

The tanker fallout from impending Russian insurance coverage ban


The probably insurance coverage ban that each the UK and the European Union wish to placed on any tankers carrying Russian oil wherever on this planet is anticipated to create an enormous additional shake-up in tanker fortunes. The insurance coverage ban follows swiftly on from information the EU is to cease taking seaborne imports of Russian oil this 12 months.

Crunching the numbers on what the result might be is Poten & Companions, the New York-based tanker brokers, which has predicted that every one the sanctions, particularly with the additional stress of the insurance coverage ban, might see Russia reduce its exports from the Black Sea and the Baltic by 50% to 1m barrels per day every.

Aframaxes and suezmaxes are the popular tankers to export crude from the Baltic and the Black Sea. If an insurance coverage ban takes many of the worldwide tanker fleet out the equation, Russia, China and India should use domestically owned or managed tonnage to maneuver the crude, Poten identified in its newest weekly report.

For the Baltic exports, Poten reckons a fleet of 20 aframaxes for lightering and 23 VLCCs could be wanted to maneuver 500,000 barrels per day to China and 31 suezmaxes to maneuver the same quantity to India. For the exports from the Black Sea, the requirement is for 10 aframaxes, 20 to 25 VLCCs and 20 suezmaxes.

“Discovering these vessels and arranging insurance coverage for them outdoors the EU and UK markets might be very difficult,” Poten identified, including that it might additionally make it tough for these vessels to get employed in common worldwide oil trades.

The insurance coverage ban shall be keenly felt by Greek shipowners, who within the opening 100 days of the warfare between Russia and Ukraine, have been among the many prime movers of Russian cargoes.

Utilizing marine insurance coverage as a sanctions weapon is just not new. In 2012, a European Union oil embargo on Iran prohibited EU insurers from masking Iranian oil exports wherever on this planet. This proved to be a really highly effective instrument with Poten noting how Iranian exports dropped 25% to 30%. The distinction with Russia in 2022, nevertheless, is that nations comparable to China and India should not onboard with present sanctions.

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