A peace deal doesn’t mean the end of the shadow fleet

EVEN if a peace between Russia and Ukraine is agreed, it is unlikely the shadow fleet* will come back into mainstream shipping, panellists told the Lloyd’s List Outlook Forum in London.

President Trump continues to pressure both presidents Putin and Zelensky to agree a peace deal that would bring to an end Russia’s war in Ukraine after more than three years.

But peace would not necessarily mean an end to the shadow fleet.

Lloyd’s List senior risk and compliance analyst Bridget Diakun told the Outlook Forum that even if all sanctions on Russia were lifted tomorrow, “some of that fleet would likely be deployed into Iranian and Venezuelan trade”.

“We’re not going to lose Iran or Venezuela,” she said.

Ultimately, the deceptive shipping practices learned over the past few years are unlikely to be shelved.

“We’ve got years of this knowledge and experience of being deceptive now at people’s fingertips. If anyone wants to engage in shadowy activity, it’s so easy for them to do it because the system is there. So we can’t go back from this point,” she said.

This was an assessment the live audience overwhelmingly agreed with. Some 94% at Trinity House in London this morning said the shadow fleet would continue to be a problem for shipping, even if a peace deal were signed with Ukraine.

The assumption many are under is that sanctions would be lifted in the event a peace deal is reached, but International Institute for Strategic Studies senior fellow for Russia and Eurasia Nigel Gould-Davies said that wasn’t necessarily the case.

“I sense no appetite at all in Europe on the frontline of this severe and existential threat for allowing Russia to get richer,” he said.

“Europe will certainly consider Russia a threat and feel that it’s in Europe’s compelling interest to constrain Russia’s economy, even if Russia is not actively fighting in Ukraine.”

There could also be a divergence of strategy across the Atlantic, he said, as the US moves to loosen sanctions.

NorthStandard head of sanctions Mark Church questioned what happened to those shadow fleet tankers that had plied the Russian trade for the past few years in the event of peace.

“Do we welcome them back, as industry, to the mainstream? Do we welcome them back to mainstream insurance?

“Or, for the lifetime of those vessels, are they outside of mainstream shipping networks?”

He noted that the UK has not delisted a single vessel since under its Ukraine programme, which perhaps gives an indication of its approach.

The shadow fleet, in the meantime, has got more shadowy, Diakun said.

Spoofing is getting more advanced, she told the London audience, but novel techniques such as shared MMSI numbers (which flag registries issue to vessels) and using the International Maritime Organization identifying number of scrapped vessels, are becoming more common.

“So trying to figure out who’s actually who is almost impossible now,” she said.

“I think that does make it more dangerous, because you don’t know where these ships are a lot of the time and there’s not an easy way to figure it out.”

Trying to ascertain identity in the event of a large incident — such as a grounded tanker, for instance — could prove very difficult, she added.