The Rise of Shadow Tankers
The shadow fleet has grown exponentially since the start of the Russia-Ukraine war in 2022. By one estimate, there are about 1,000 shadow tankers operating worldwide, which is equivalent to 15-20% of the global tanker fleet. These vessels are typically unregulated, circumventing price caps and insurance bans by hiding their identity. These vessels, often decades old, fly flags of convenience from small, under-resourced states and employ opaque ownership structures to hide their true cargo and destination.
Case Study: The Caroline Bezengi Disaster
The Caroline Bezengi, a 2001-built Suezmax carrying 800,000 barrels of Russian crude, grounded on the rocks of Oman’s Hallaniyat archipelago, inside a marine reserve created to protect endangered humpback whales. Oil has since reached the mainland, with cleanup costs estimated at $200–500 million. The registered owner had already dissolved, its flag state suspended its registry for fraud, and no insurer has come forward to pay the cleanup costs and for resources engaged in mitigating the environmental damages.
The Insurance Vacuum and the Burden on Coastal States
Had a similar situation occurred to a vessel insured by one of the IG P&I Clubs, the insurer would have swung into action immediately, taken all possible measures to mitigate the damage, and proactively deployed suitable resources, while also ensuring affected parties and local communities were compensated. In the Caroline incident, however, the Omani authorities are responding using their own resources; the response itself could cost hundreds of millions. The struggle to secure a dedicated fund has wasted crucial initial days, and as a result, adequate resources are still not being deployed due to this funding shortfall.
The Enforcement Divide: Do Sanctions Make It Worse?
Most countries in the world recognise UN sanctions, but in the recent past, more non-UN sanctions have been used by the US and its allies, leveraging the grip on the global financial and banking ecosystem that is essential for facilitating insurance coverage of such magnitude. However, this approach is undermined by a fragmented global response. Many countries in Asia and Africa recognise only UN sanctions and continue to trade with sanctioned states, either out of economic necessity or diplomatic choice. This provides safe havens for shadow tankers and enables their operations.
Root Causes and the Path Forward
So, are sanctions the root cause? Not solely. The underlying drivers remain geopolitical conflict and the global thirst for oil. But sanctions are undeniably a catalyst. They are a blunt instrument that, while politically necessary, lacks the nuance to prevent collateral environmental damage. Sanctions may be a legitimate tool of foreign policy, but their environmental and humanitarian side effects are becoming intolerable. The Oman spill is a clarion call, not to abandon sanctions, but to urgently design a parallel system of maritime governance that protects the oceans and the vulnerable communities that depend on them. Without such a framework, the next spill is not a question of “if”, but “when”.
Original Article: VIEWPOINT: Environmental Risk of the Shadow Fleet – A Legal and Regulatory Failure — Shipandbunker