Oil tankers carrying millions of barrels of Kazakh crude are being prevented from leaving the Black Sea to reach global markets after Turkey tried to insist on proof they are properly insured.
The Ankara government insists the ships have a letter from their insurer guaranteeing insurance coverage while in Turkish waters, which is yet to happen. The move follows sanctions by the European Union and the United Kingdom that only allow ships carrying Russian crude oil to be insured if the oil on board is purchased at a price of $60 (EUR 57) or less per barrel.
The result: At least 20 freighters with 18 million barrels of crude oil have been waiting for several days to pass the Bosphorus and the Dardanelles shipping lanes. All but one have cargoes from Kazakhstan on board and a local port agent reports that the ships are awaiting clarification on their insurance status.
On Monday, providers of covers against risks, including spills and collisions, said the letters Turkey is demanding could not and should not be released for the time being. The US and UK governments have been urging Turkish officials to reconsider their approach, and insurers may yet accede to the request.
A G7 cap on Russian oil prices set last week only allows European firms to insure tankers transporting Russian crude if the cargoes are bought at or below $60 a barrel. Without this proof, the traditional check on the insurers’ websites is no longer sufficient for the Turkish authorities.
The waiting tankers sail around the world, from South Korea and India in the east to Panama in the west. But most are destined for Europe, which has banned the purchase of almost all Russian crude at sea but allows imports of the Kazakh variety, which are shipped from a terminal on Russia’s Black Sea coast.
Nineteen of the waiting tankers are transporting CPC crude oil from Kazakhstan. The other contains about 1 million barrels of Russian Urals bound for India, according to port agent reports and ship-tracking data monitored by Bloomberg.
In practice, Kazakh oil should not be subject to sanctions, but the fact that the ships left a Russian port may add to concerns in Ankara about confirming their insurance status. Likewise, insurers could challenge the precedent of writing letters for summonses that are not subject to sanctions.
The only Russian crude oil tanker awaiting passage has been anchored in the Sea of Marmara near the northern entrance to the Dardanelles since Wednesday.
Shipments of Ural and Siberian Light crudes from the port of Novorossiysk were running at low levels anyway, with only three shipments loaded in the week ending December 2. This makes it difficult to determine whether Russian flows are also being disrupted by Turkey’s stance. or simply Kazakhstan.
Revenue for ships from the Black Sea to the Mediterranean rose 7 percent to $153,000 a day.
https://www.independent.ie/business/world/turkey-halts-oil-tankers-as-russia-price-cap-takes-effect-in-latest-sanctions-squeeze-over-ukraine-invasion-42200767.html Turkey halts oil tankers as Russian price cap comes into effect in latest sanctions push over Ukraine invasion