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U.S. Sanctions Impact Russian Oil Tankers' Flag Registrations

US Sanctions Impact Russian Oil Tankers’ Flag Registrations

Posted on March 11, 2024
Writer: James Miller

In response to increased U.S. sanctions, Russian oil tankers are moving away from the Liberian and Marshall Islands flags. Notably, the flag administration companies for Liberia and the Marshall Islands are based in Virginia, placing them directly in U.S. regulatory jurisdiction.

The U.S. Treasury Department recently sanctioned 41 oil tankers for breaching a $60 per barrel cap on oil. The cap was introduced by the G7, the EU, and Australia in December 2022 to reduce Russia’s income from oil exports without disrupting global energy markets. Among the sanctioned vessels, 24 were flying the Liberian flag, and one was under the Marshall Islands flag.

As a result, there’s been a noticeable shift towards other registries, with Gabon emerging as a popular choice for reflagging Russian tankers. At least three of the sanctioned ships had recently moved from the Liberian to the Gabon flag, signaling a strategic pivot to maintain operations amidst tightening sanctions.

The reaction from the flag registries has been swift, with the Liberian registry actively removing sanctioned vessels from its registry. Similarly, the Marshall Islands are working with U.S. authorities to ensure compliance. Gabon has expressed its readiness to delist any vessel found to be involved in illegal activities, reflecting a global commitment to uphold legal and regulatory standards in maritime operations.

For more in-depth analysis, refer to the original report on Yahoo Finance.

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