Price Cap Coalition Cracks Down on Sanctions-Busting: New Advisory Takes Aim at Russia's ‘Shadow Fleet’

Introduction

The Price Cap Coalition (PCC), a group of countries implementing a price cap on Russian oil, has issued a new advisory to further tighten sanctions and crack down on sanctions-busting practices. The advisory specifically targets Russia's "shadow fleet" of vessels allegedly used to circumvent sanctions and continue exporting oil at prices above the cap.

Key Points of the Advisory

The advisory highlights several key points:

Identification of Russian-owned or controlled vessels that are not registered in Russia or are using flags of convenience to avoid detection.

Enhanced monitoring of ship-to-ship transfers, which can be used to blend Russian oil with other grades to disguise its origin.

Increased cooperation and information sharing between PCC member countries to track and identify vessels involved in sanctions-busting activities.

Impact on Russia's Oil Exports

The advisory is expected to have a significant impact on Russia's oil exports, as it will make it more difficult for Russia to sell its oil at prices above the cap. The advisory also sends a strong message that the PCC is committed to enforcing the price cap and preventing Russia from circumventing sanctions.

Implications for the Global Oil Market

The crackdown on sanctions-busting practices could also have implications for the global oil market. By reducing Russia's ability to export oil at prices above the cap, the PCC hopes to stabilize the market and prevent further price spikes. However, it is possible that the advisory could lead to increased volatility in the oil market as Russia seeks alternative ways to sell its oil.

Conclusion

The PCC's new advisory is a significant step in the effort to enforce the price cap on Russian oil and crack down on sanctions-busting practices. The advisory is expected to have a significant impact on Russia's oil exports and the global oil market. It also sends a strong message that the PCC is committed to holding Russia accountable for its aggression in Ukraine.