China Builds Its Own “Shadow Fleet” to Import Russian Gas Under Sanctions
China is creating its own “shadow fleet” of vessels to import Russian gas that is under US sanctions. The effort remains in its early stages, but tanker movements and ownership patterns in China are beginning to mirror those previously observed in Russia.
Experts note that Beijing is intensifying its push to import Russian gas under sanctions, laying the groundwork for a domestic “shadow fleet” capable of transporting energy and bypassing restrictions imposed on one of the Kremlin’s flagship industries. This move comes as Western governments increase pressure on buyers of Russian oil and gas in response to Moscow’s 2022 invasion of Ukraine.
Concealing Beneficial Ownership
The LNG tanker CCH Gas, which carries Russian gas and is on a blacklist, has been concealing its location as it approaches a Chinese port. The vessel’s registered owner, CCH-1 Shipping Co., is legally based in Hong Kong at the same address as Samxin Secretarial Services Ltd.—a common practice among companies seeking to obscure beneficial ownership while trading fuel from Iran or Russia.
Another LNG carrier, recently renamed Kunpeng, was spotted near Singapore with a similar corporate structure. This complexity makes concealment far more difficult than in the oil trade, where only about 800 vessels are involved globally.
Relaxation of Ownership Restrictions
Meanwhile, China is also allowing private investors to hold stakes of more than 10% in certain railway and energy projects traditionally funded by the state, effectively removing restrictions on the participation of non-state entities in these ventures. This relaxation of ownership restrictions will likely facilitate the growth of China’s shadow fleet.
Russia’s “Dark Fleet”
In parallel, Russia itself has been assembling a similar “dark fleet” of LNG carriers since last year, registering more than a dozen vessels under shell companies stretching from Russia to India. This effort has emerged as Western governments increase pressure on buyers of Russian oil and gas in response to Moscow’s 2022 invasion of Ukraine.
Original Article: Bloomberg: China building its own “shadow fleet” to import gas from Russia — Caliber