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Pileup of oil tankers leaving the Black Sea – POLITICO

A traffic jam of tankers has piled up in front of Turkey’s Bosphorus Strait thanks to new demands for insurance paper from Ankara – a knock-on effect of sanctions on Russian maritime crude which came into force this week.

However, a dozen of the tankers lined up on the key Black Sea-Mediterranean shipping route carry crude from Kazakhstan, not Russia, said Viktor Katona, senior crude analyst at intelligence firm Kpler.

“Russian cargoes apparently have no problem, yesterday three tankers carrying Russian petroleum products had no problem crossing the strait,” he said.

Turkey’s transport ministry, maritime authority and mission to the EU did not immediately respond to requests for comment.

EU members, along with G7 countries and Australia, agreed to impose a price limit of $60 a barrel on Russian crude starting Monday. Under the deal, the countries ban insurance and shipping companies from offering their services to Russian oil shipments to non-EU countries if it is sold above the price cap . The EU has also imposed its own ban on imports of Russian maritime crude.

The goal is to reduce Russian oil revenues and undermine its ability to wage war on Ukraine without disrupting global oil flows.

Turkey has not joined the G7 insurance ban and still imports Russian oil.

Red ribbon

Since December 2, Ankara began requiring insurers to confirm that ships would remain fully covered when passing through the Bosphorus, Turkish waters, ports or terminals – even if the ships were found to be in breach of the new penalties.

Considering the risk of “catastrophic consequences for our country, our property and our people in the event of a probable accident … during the passage through the Turkish Strait of ships carrying in particular goods such as crude oil products … we is absolutely requested to confirm in some way that their P&I insurance is still valid and complete,” the Turkish government wrote in a November 16 statement. letter to the EU and a host of shipping associations, who set the policy before it came into effect.

But the International Group of P&I Clubs said its clubs “cannot and should not” provide such an unconditional letter of guarantee, as it would expose “the Club to a breach of sanctions under EU law, of the United Kingdom and the United States and, as such, the Clubs cannot comply with the request of the Turkish authority.

As a result, tankers with P&I club insurance are now blocked, while vessels with Russian-issued insurance are allowed to pass.

“P&I clubs don’t really issue cover letters for individual voyages, with cargo, vessel and voyage destination – it’s normally a paper insurance policy document carried throughout the year – but now that’s what the Turks are asking for,” said Katona. “Whereas Russian insurers, for example Ingosstrakh, do not hesitate to provide individual certificates of cover.”

Lloyd’s List tracking data shows a nearby large tanker which loaded at the Russian port of Novorossiysk and 12 others which filled up at offshore loading terminals connected to the CPC pipeline, which carries mainly Kazakh oil and some Russian oil .

Kpler data also showed that 12 of the tankers loaded into the queue had filled from the CPC pipeline.

Most of the vessels currently stuck are either Suez tankers, which can hold 1 million barrels of oil, or Aframax tankers, which carry around 600,000 barrels.

Mix the oils

Volumes are allocated to Russia and Kazakhstan from the CPC pipeline under a quota system, with each oil shipment having its own certificate of origin so there is no confusion. Earlier this year, the Kazakh government successfully negotiated to have its oil granted an explicit exemption from the Russian EU embargo, despite the CPC pipeline passing through Russia.

“It’s widely believed that the ships loading in this particular area are carrying Kazakh oil – the fact that they’re all delayed…is strange, because they shouldn’t be caught up in this,” said Michelle Wiese Bockmann, editor. Chief and Market Analyst. to Lloyd’s List.

“Either they have a very big administrative problem or the Turkish authorities are playing tough,” she said. “It’s becoming a real problem… no tankers have passed.”

Earlier this year, EU diplomats raised the possibility that banned Russian oil is seeking to circumvent the EU embargo by using fake certificates of origin from Kazakhstan.

Brenda Shaffer, senior fellow at the Atlantic Council’s Global Energy Center and professor of energy at the US Naval Postgraduate School, said Turkey had been particularly cautious about possible sanctions violations in recent years.

“Since Kazakh-origin oil will mainly be supplied to the EU market, its cargoes are subject to special scrutiny,” Shaffer said.

A statement from the Kazakh government says the insurance issue is “being clarified”.

The European Commission declined to say whether negotiations were underway with Turkey to resolve the issue.

A UK Treasury spokesman said: “The UK, US and EU are working closely with the Turkish government and the shipping and insurance sectors to clarify the implementation of the oil price cap and reach a resolution.”

The spokesman added that the price cap agreement provides insurance exemption for emergency situations such as oil spills, so “there is no reason for vessels to be denied the access to the Bosphorus Strait for environmental or health and safety reasons”.

Andreas Economou, director of the oil research program at the Oxford Institute for Energy Studies, said it was still too early to say whether the heist would affect world markets; Brent’s benchmark price has fallen nearly 10% in the past five days to around $78 a barrel.

Katona said Russian crude in the Black Sea is mostly delivered to Bulgaria, which has a one-year exemption from the EU ban, rather than through the strait, so Moscow can’t stand the weight of the current impasse.

“The pain is felt elsewhere,” Katona said, adding, “At the end of the day, this is no longer a Russian problem, but a Western problem because it affects Chevron, Eni, Total and all the other companies involved in the upstream oil operations in Kazakhstan. , [and] are shareholders of the CPC pipeline or market and sell Kazakh oil.”

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