Oil Tankers in Limbo: Navigating Sanctions and Global Energy Shifts

A new U.S. sanctions package has immobilized at least 65 oil tankers globally, affecting those near China, Russia, and elsewhere. This move targets Russian oil revenue amid the Ukraine war, causing market disruptions and a surge in supertanker earnings. Global oil transport dynamics may shift as a result.

New U.S. sanctions announced on January 10 have caused over 65 oil tankers to anchor off the coasts of China, Russia, and other strategic locations. According to ship tracking data, these tankers have been immobilized as a direct consequence of the financial penalties targeting Russian oil earnings.

The U.S. Treasury's action against Russian oil producers Gazprom Neft and Surgutneftegaz, along with 183 vessels that have carried Russian oil, is meant to disrupt Moscow's revenue streams funding its conflict against Ukraine. This development heightens existing pressures from earlier U.S. sanctions, stalling additional 25 tankers near crucial passages like Iranian ports and the Suez Canal.

Industry analysts suggest that 10% of the global oil tanker fleet is now affected by U.S. sanctions, potentially tightening market supply. Omar Nokta, an analyst at Jefferies, remarked on how the sanctions could support the tanker market by reducing vessel availability, while Kpler notes that increased demand from India and China for non-sanctioned oil could heighten demand for other tankers.

(With inputs from agencies.)