In the end, they were unable to deliver their cargo. After circling in the water for two days off the Chinese coast, the tankers Olivia And Huihai Pacific left on January 13 for their loading port, Kozmino (Russia). Four other ships are still anchored off the coast of Shandong province, but it is not yet known whether they will be able to dock. The reason? The spectacular sanctions announced on January 10 by the White House, which target two major Russian oil producers and more than 150 “ghost tankers”, used by Moscow to export its black gold, under opaque conditions.
Why is Washington striking now? “The timing is perfect,” replies Marc-Antoine Eyl-Mazzega, energy specialist at the French Institute of International Relations (Ifri). The oil market is in surplus, with abundant supply from America (United States). , Canada, Brazil) and OPEC countries, which continue to produce at relatively high levels. At the same time, global growth is slowing sharply, which is having a downward impact on crude demand. Attacking Russian oil should therefore not cause a major shock.
Chinese reluctance
On the other hand, the impact of these sanctions risks being devastating for Russia, which transports 22% of its black gold via this “ghost fleet”, according to figures from the International Energy Agency. Moscow therefore risks having more and more difficulty finding buyers. The American authorities having made it clear that “any foreign person or financial institution could be subject to sanctions for knowingly facilitating transactions” with Moscow, Chinese operators (trading, refining), like their Indian counterparts, who had nevertheless doubled their purchases of Russian crude oil last year, will not take the risk of being targeted in turn – and of being excluded from the dollar banking system. Already, the banks involved in Russian-Indian trade are much more careful about the certificates of origin of cargoes.
Indians and Chinese should therefore turn to new sellers. Iraq, the United Arab Emirates and Kuwait have recently received “inquiries” from Chinese and Indian buyers to supply additional crude in the coming months, according to the Bloomberg agency. And New Delhi has just announced that it would prohibit access to its ports to sanctioned oil tankers from March.
‘Russian’ makeup
Certainly, Moscow will find solutions. “If something is blocked, alternatives appear elsewhere,” Kremlin spokesman Dmitry Peskov said on January 13. There is no doubt that Russian operators will be more creative to circumvent American measures. “Disguising transactions, the ownership of ships, their names and their itineraries… The game of cat and mouse will continue, opines our Ifri expert. The Russians could, for example, re-register sanctioned ships, transfer active in new companies… They certainly anticipated the American measures and we will undoubtedly soon discover transfers of ownership in companies which have not yet been identified.”
But these processes take time and are complex to implement. Especially since flags of convenience will think twice before registering Russian tankers, for fear of American reprisals. In any case, they will charge more for their services. Logistics costs will therefore increase for Moscow, which will ultimately cause reductions in revenue linked to hydrocarbon sales.
Maintain sanctions
It is now necessary for these sanctions, taken – very late – by Joe Biden, to be maintained by his successor Donald Trump, who will take up office next Monday in the Oval Office. It’s very likely. Treasury Secretary nominee Scott Bessent said during his Senate hearing on January 16that he is “100% in favor of increasing sanctions, particularly against major oil companies, to levels that would bring the Russian Federation to the negotiating table.” In fact, Trump has all the more interest in maintaining them since he is not the signatory, which allows him to keep his room for maneuver and maintain ‘strategic ambiguity’ about his intentions. If he succeeds in making Vladimir Putin bend, he will be able to say thank you to Joe Biden…