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Updated Advisory for the Maritime Oil Industry published.
The Price Cap Coalition has on 21 October 2024 issued an updated advisory with recommendations for stakeholders in the maritime oil trade. The advisory outlines best practices to address heightened risks in the industry, emphasizing the importance of preventing sanctions evasion and ensuring compliance with price caps on Russian crude oil and petroleum products. These caps are maintained by the G7, European Union, Australia, and New Zealand to limit Russian revenue while maintaining global oil supply.
Recent developments in the maritime oil trade, including the emergence of a “shadow fleet,” have raised concerns over safety, environmental impact, and transparency. This shadow trade often involves older vessels operating under questionable flags, increasing risks of maritime casualties, fraudulent practices, and environmental damage.
The advisory issued by the US Department of Treasury’s Office of Foreign Asset Control (OFAC) includes recommendations for industry stakeholders, such as requiring vessels to have appropriate capitalized P&I insurance, adhere to international safety standards, and use Automatic Identification Systems (AIS) for vessel tracking. The Coalition also urges all involved parties to conduct appropriate due diligence, monitor high-risk ship-to-ship transfers and report ships that trigger concerns to mitigate reputational, financial, and legal risks.
With the updated advisory of 21 October 2024, four new recommendations are presented including a specific warning for all parties (including brokers, managers, operators) involved in the sale and brokering of tankers. Stakeholders are now strongly encouraged “to conduct enhanced due diligence” and ensure KYC checks on both buyers and the buyers’ associates in these transactions. Additionally, the recommendation from the Coalition now includes that all data should verified “against third party databases, media and market intelligence”.
You can find the updated advisory here.