Russia is using decades-old oil tankers on icy waters to duck sanctions and prop up its struggling energy exports

An abandoned cargo vessel lies
An abandoned cargo vessel lies beached along the Black Sea near the war torn city of Ochamchire in Abkhazia.Loop Images / Contributor
  • Russia is using decades-old oil tankers without sufficient insurance to dodge Western sanctions, according to the Washington Post.

  • The aged vessels pose safety risks to the environment and ship crews, as they navigate through shallow and icy waters.

  • The EU and G7 countries have slammed Russia with sanctions that deny the nation insurance services unless its crude trades at or below a price cap.

Russia is using decades-old tankers to ship its oil and gas abroad in a hazardous act to dodge Western sanctions, according to the Washington Post.

The aged vessels, which would otherwise be in the dumps, risk catastrophic accidents or oil spills, and have even experienced engine failures out at sea.

That has elevated fears among countries located on the Baltic Sea, which is a northern route for Russian oil shipments, because the water is shallow and icy – something ship crews have little experience with.

It's prompted Finnish authorities to ramp up emergency drills in the event of an oil spill or an environmental disaster, Mikko Hirvi, the deputy head of the Finnish Coast Guard district, told The Post.

"When we see new vessels which haven't been operating here before, we really don't know the crew competence in ice navigation skills," Hirvi said. "The potential risks are there, and they are higher than before," he added.

The European Union and G7 countries have slapped crippling sanctions on Russia's oil and gas exports following its invasion of Ukraine, including import bans and price caps.

Under the price-cap rules, buyers of Russian oil can only access European shipping and insurance services if they have purchased it for $60 a barrel or less. The measure aims to limit Moscow's ability to fund its war against Ukraine, while still keeping Russian oil flowing through global markets to prevent a shortage.

According to The Post, a large number of tankers transporting Russian oil on old ships appear to be uninsured, meaning there may not be any resources to clean up any oil spills.

These moves by Russia suggest attempts to mitigate Western sanctions from having their desired effect. But that doesn't seem to be working, given the penalties have bitten into the nation's export revenue.

In February, Russia's revenue from its oil and gas exports halved. That's despite Moscow selling huge amounts of crude to buyers in Asia, including China and India. According to Bloomberg, Russia has even overtaken Saudi Arabia as China's biggest oil supplier.

Read the original article on Business Insider