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Russian Oil Adrift: How Sanctions Turned Tankers Into Floating Storage
(MENAFN- The Rio Times) Key Points
For most people, oil is just a number on a fuel receipt. Right now, millions of barrels of Russian crude are circling the oceans, waiting for buyers willing to be seen taking them.
Washington's latest sanctions on Russian producers were meant to squeeze the Kremlin's war chest. Instead, they have created a new map of shipping, where tankers take longer routes, switch off their trackers and change destination at the last minute.
Russia is still putting roughly 3.4 million barrels of crude a day onto ships. The problem is unloading it. Voyages that once took just over a week from Russia 's Pacific port of Kozmino to China now take around 12 days.
Russia's Oil Trade Slips Into the Shadows
More than 180 million barrels of Russian oil are sitting on tankers. Some ships even sail the long way around Africa instead of using the Red Sea, to avoid extra scrutiny and insurance worries.
To hide who is buying and selling, more tankers now sail under vague labels like“For Orders” or no declared destination at all. Many belong to an ageing“shadow fleet” with unclear owners and weaker insurance.
Ship-to-ship transfers in remote waters and fake signals on tracking systems are now part of the business model. Prices tell their own story. Russia is shipping more, but at steeper discounts.
Its benchmark grades are trading well below global prices, so weekly export income has flatlined even as volumes rise. For Moscow, that means less money per barrel and more risk that a single accident or attack on a tanker can cause serious damage.
For expats and investors in Brazil, Europe or Asia, the lesson is clear. When politics tries to micro-manage a global commodity, trade does not stop.
It moves into the shadows, and the winners are those who understand the loopholes best, not the households and smaller importers who eventually pay the bill.
Tougher U.S. sanctions keep Russian exports high but leave more barrels stuck at sea for longer.
A growing“destination unknown” trade shifts power from transparent markets to opaque middlemen.
The hidden costs show up in higher risk, distorted prices and new pressure points for global energy security.
For most people, oil is just a number on a fuel receipt. Right now, millions of barrels of Russian crude are circling the oceans, waiting for buyers willing to be seen taking them.
Washington's latest sanctions on Russian producers were meant to squeeze the Kremlin's war chest. Instead, they have created a new map of shipping, where tankers take longer routes, switch off their trackers and change destination at the last minute.
Russia is still putting roughly 3.4 million barrels of crude a day onto ships. The problem is unloading it. Voyages that once took just over a week from Russia 's Pacific port of Kozmino to China now take around 12 days.
Russia's Oil Trade Slips Into the Shadows
More than 180 million barrels of Russian oil are sitting on tankers. Some ships even sail the long way around Africa instead of using the Red Sea, to avoid extra scrutiny and insurance worries.
To hide who is buying and selling, more tankers now sail under vague labels like“For Orders” or no declared destination at all. Many belong to an ageing“shadow fleet” with unclear owners and weaker insurance.
Ship-to-ship transfers in remote waters and fake signals on tracking systems are now part of the business model. Prices tell their own story. Russia is shipping more, but at steeper discounts.
Its benchmark grades are trading well below global prices, so weekly export income has flatlined even as volumes rise. For Moscow, that means less money per barrel and more risk that a single accident or attack on a tanker can cause serious damage.
For expats and investors in Brazil, Europe or Asia, the lesson is clear. When politics tries to micro-manage a global commodity, trade does not stop.
It moves into the shadows, and the winners are those who understand the loopholes best, not the households and smaller importers who eventually pay the bill.
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