Shadow Fleet Seizes Opportunity Amid War Chaos
Just weeks ago, the net appeared to be tightening on the armada of tankers known as the shadow fleet as western powers cracked down on the movement of illicit oil. But as the war with Iran has unfolded, these clandestine ships have become a crucial conduit — transporting crude while conventional traffic sits stranded in the Gulf.
Days before the war, Iranian tanker Hilda I transited the Strait of Hormuz. While passing through the Gulf, the crude carrier went dark. Satellite imagery appears to show the vessel loading at Iran‘s primary crude oil export terminal in breach of sanctions. As the conflict raged, the vessel fled the Gulf with its signal off and headed towards China, the shadow fleet’s biggest customer.
Shadow Fleet Exploits War-Time Conditions
The Noble Walker, a Russian ghost tanker, U-turned near China on March 4 to deliver to India, taking advantage of wartime conditions. With US restrictions easing, and the world increasingly dependent on shadow oil, the fleet is poised to emerge from the war stronger than ever.
Yörük Işık has been watching shadow fleet tankers travel in and out of the Black Sea “almost without disruption” for years. The three weeks since the start of the Middle East war have been no different, with vessels in both the dark and legitimate trades regularly sailing through. “Every one hour and 20 minutes, a tanker passes,” he says.
Sanctions Easing, Shadow Fleet Thriving
Until a few weeks ago, the shadow fleet’s vessels were on the run. Enforcement action by the US and Europe had tightened as governments sought to pile pressure on Russia, Iran, and Venezuela. Hundreds of ships were added to western blacklists, and more than a dozen shadow vessels seized between December and February — a significant escalation on the previous year.
But the Iran war has given the hundreds of ageing ships that make up the fleet a new lease of life, as conventional shipping in and around the Strait of Hormuz has become largely trapped and the price of crude oil has spiralled upwards. Concerns about further price rises led Washington to turn a blind eye to the illicit Iranian trade, temporarily lifting sanctions on the roughly $15bn worth of oil the country has at sea.
The Islamic republic has exported millions of barrels of oil since the end of last month, likely earning Tehran more than $140mn a day. At least 15 Iranian oil tankers have passed through the Strait since the war began on February 28 — most concealing their location for part of the transit. Satellite imagery has captured multiple vessels filling up at Kharg Island, the country’s main export terminal.
Shadow Fleet’s Newfound Strength
The shadow fleet’s newfound strength is a result of the war and the easing of US sanctions. The fleet’s biggest customer is China, which has been taking advantage of the situation to secure its energy needs. With the world increasingly dependent on shadow oil, the fleet is poised to emerge from the war stronger than ever.
As the conflict rages on, it remains to be seen how long the temporary lifting of US sanctions will last and what impact it will have on the global energy market. One thing is certain, however: the shadow fleet has seized the opportunity presented by the war chaos to thrive in a lucrative illicit trade.
Original Article: How the shadow fleet is capitalising on the chaos of war — Ft