US Reimposes Naval Blockade on Iranian Ports Amid Collapse of Peace Deal
Washington has reimposed its naval blockade of Iranian ports after the collapse of a planned peace deal to end the US-Israeli war on Iran. The move is seen as a significant escalation in the conflict, which has been ongoing for decades.
The US has long sought to isolate Iran from the global shipping industry through a range of sanctions. However, Tehran has managed to maintain some revenue by operating a network of rickety tankers often described as its “shadow fleet“. These vessels occupy a legal grey zone and use subterfuge to skirt US measures.
How Do Shadow Fleets Work?
Shadow tankers, also known as “dark fleets” or “ghost fleets”, are ships that operate on the fringes of the global shipping industry to transport oil and other commodities from countries facing western sanctions. Many are ageing vessels that evade detection by turning off their mandatory tracking signals or broadcasting false locations.
Iran is not the only country involved in such operations. Russia, which is also subject to oil sanctions, operates a shadow fleet. Venezuela did so until the US attack on the country earlier this year and the seizure of many of its tankers.
The ships are usually registered in countries with low shipping taxes, lax regulation, opaque registries, and few questions asked. Such vessels sail under what are known as “flags of convenience” belonging to, among others, Bermuda, Liberia, Panama, Malta, and the Marshall Islands.
The Shadow Fleet’s Ultimate Ownership
The ultimate ownership of these ships can often be traced back to Iranian billionaires affiliated with the Islamic Revolutionary Guard Corps. Others are owned by businessmen from China, which is a major customer of Iranian oil. The crews are often drawn from merchant seafarers from Iran, China, and South Asia.
Prior to the blockade, analysts estimated that the fleet consisted of about 400 ships, although counts vary. Vessels leave Iran, then unload the oil to another tanker at sea before the cargo reaches its ultimate destination. “Ship-to-ship” transfers are not illegal but can make it harder to trace the origin of cargo.
Why Does Iran Have a Shadow Fleet?
Iran’s shadow fleet has evolved as a response to US sanctions on its most lucrative export, oil. Only the US, EU, and Canada have placed blanket bans on their businesses buying Iranian oil, meaning buyers in other countries can technically import it freely under their own domestic laws, so long as it does not breach other sanctions.
However, Washington also imposed far-reaching secondary sanctions on the Iranian energy sector, under which it will sanction and freeze the assets of any organisation worldwide that buys, transports, or finances Iranian oil – whether the business is American or not. These secondary sanctions on Iran were first introduced by US President Bill Clinton in 1996 amid concerns over Iran’s nuclear programme and its backing for regional groups that oppose the US.
The measures have cut off Iran from much of the international shipping industry, which relies on US banks and dollar transactions and so cannot risk penalties imposed by Washington. Amid such isolation, and the devastating impact it has had on its economy, Tehran has looked at other ways to sell oil.
Who Buys Shadow Fleet Oil?
China is the largest buyer of Iranian oil, although it does not officially record such imports, which would attract US sanctions. Instead, it marks the oil as coming from Malaysia and Indonesia, among others. However, China’s figures often do not match those countries’ export data, which has raised concerns over the accuracy of Beijing’s claims.
The US blockade is likely to further complicate the situation, as Iran seeks alternative buyers for its oil. The move is seen as a significant escalation in the conflict and could have far-reaching implications for global energy markets.
Original Article: War on Iran: What is Tehran’s ‘shadow fleet’ really and how does it work? — Middleeasteye