The Financial Times ran a story today on this latest example of sanctions backfiring, reporting on the backup of a couple of dozen Western oil tankers at the Bosphorus Strait, because Turkey has been demanding heightened insurance guarantees, since uninsured vessels (under the new G7 anti-Russian provisions) risked causing “catastrophic” damage in the Turkish Straits.
The FT reported with annoyance: “Meanwhile, the only crude vessels getting through the straits may be vessels carrying Russian oil. One oil industry participant with knowledge of the situation said Russian insurance companies had provided the requested letters of confirmation to Turkish authorities.… Vessels carrying Russian oil were submitting letters from newly established non-European P&I [protection and indemnity] clubs outside the main International Group, which represents 90% of the industry and has so far refused Turkey’s request.” One peeved industry source told the FT: “The mainstream fleet is blocked … while in theory the shadow fleet can transit.”
The FT explained the significance of this oil route: “The Turkish Straits is one of the busiest shipping lanes in the world and is one of four export routes for Russian seaborne crude. The others are the Baltic Sea, the Barents Sea and the Sea of Japan.… Every year an estimated 48,000 tankers cross the waterway, carrying about 3 million barrels a day of oil.”
