Russia is forming a "shadow fleet" to circumvent restrictions on the sale of oil, which Western countries introduced in response to its full-scale invasion of Ukraine, writes the Financial Times.

According to shipping broker Braemar, Russia, which is heavily dependent on foreign oil tankers, has built up a fleet of more than 100 aging tankers.

Energy consultancy Rystad says Russia added 103 tankers to its oil supply chain in 2022 through purchases and redeployment of vessels serving Iran and Venezuela, two countries subject to a Western oil embargo.

Anonymous purchases of tankers can be traced to a significant increase in unnamed or new buyers appearing in the registers.

Typically, such vessels are 12-15 years old and are expected to be scrapped in the next few years, said the head of tanker research at Braemar.

The company also notes that in 2022, Russian-linked operators are believed to have purchased up to 29 supertankers, known as VLCCs (Very Large Crude Carriers).

These are large crude oil tankers, each of which is capable of transporting more than 2 million barrels.

Russia is also believed to have added to its fleet 31 Suezmax-sized tankers, capable of carrying about 1 million barrels of oil each, and 49 Aframax tankers, each of which can carry about 700,000 barrels.

As analysts explain, after the entry into force of sanctions, Russia will need a larger number of tankers, because the length of each flight will increase: oil that was previously sold in Europe will be sent to new buyers in Asia.

Traders argue that the creation of a "shadow fleet" will reduce the impact of sanctions, but not eliminate it completely.

Russia will still face a shortage of tankers and in the first months of 2023 may face difficulties in maintaining the level of exports, which will lead to an increase in prices.

Russia needs more than 240 tankers to maintain current export volumes, Rystad analyst said.

  • On December 2, the European Union, the G7 and Australia agreed on a maximum price for Russian tanker oil of $60 per barrel.

    From December 5, the country will provide services related to Russian tanker oil only if it was purchased at a price of 60 dollars per barrel or lower.

    Services include, in particular, mandatory insurance of marine transportation of fuel.

  • Russia has repeatedly promised not to sell oil below the market price to countries that will join the restrictions.