Following stiff letters sent to shipowners by OFAC relating to compliance with the oil price cap, the Office of Foreign Assets Control has now announced sanctions on three entities and identifying as blocked property three vessels that used Price Cap Coalition service providers, while carrying Russian crude oil above the Coalition-agreed price cap. The US Treasury, of which OFAC is a department, said that “this action underscores Treasury’s commitment, alongside its international partners, to responsibly reducing oil revenues that the Russian government can use to bankroll its brutal invasion of Ukraine”.
Deputy Secretary of the Treasury Wally Adeyemo said that “shipping companies and vessels participating in the Russian oil trade while using Price Cap Coalition service providers should fully understand that we will hold them accountable for compliance. We are committed to maintaining market stability in spite of Russia’s war against Ukraine, while cutting into the profits the Kremlin is using to fund its illegal war and remaining unyielding in our pursuit of those facilitating evasion of the price cap.”
The intention of the price cap policy is to maintain a reliable supply of crude oil and petroleum products to the global market while reducing the revenues the Russian Federation earns from oil.
On October 12th the Price Cap Coalition published an Advisory for the Maritime Oil Industry and Related Sectors, directed at both government and private sector actors involved in the maritime trade of crude oil and refined petroleum products. It supplied new “recommendations” concerning specific best practices.
The Treasury said that the vessels Kazan (IMO 9258002), Ligovsky Prospect (IMO 9256066), and NS Century (IMO 9306782) engaged in the export of Russian crude oil priced above the $60 per barrel price cap, and that the three vessels used US-person services while transporting the Russian-origin crude oil.
United Arab Emirates-based (UAE-based) Kazan Shipping Incorporated (Kazan Shipping) is the registered owner of the Kazan.
UAE-based Progress Shipping Company Limited (Progress Shipping) is the registered owner of the Ligovsky Prospect.
UAE-based Gallion Navigation Incorporated (Gallion Navigation) is the registered owner of the NS Century.
Kazan Shipping, Progress Shipping, and Gallion Navigation were designated pursuant to Executive Order 14024 for operating or having operated in the marine sector of the Russian Federation economy.
OFAC also identified the Kazan, Ligovsky Prospect, and NS Century as property in which Kazan Shipping, Progress Shipping, and Gallion Navigation, respectively, have an interest.
As a result of the latest US Treasury action, all property and interests in property of the persons above that are in the US, or in the possession or control of US persons, are blocked and must be reported to OFAC.
Any entities that are owned, directly or indirectly, 50% or more by one or more blocked persons are also blocked.
All transactions by US persons or within (or transiting) the US that involve any property or interests in property of designated or blocked persons are prohibited unless authorized by a general or specific licence issued by OFAC, or exempt.
2003-built, Liberia-flagged, 62,395 gt Kazan is owned by Kazan Shipping Inc care of Oil Tankers SCF Management of Dubai, UAE. As Of November 16th the vessel was moored in Nansha, China.
2003-built, Liberia-flagged, 62,586 gt Ligovsky Prospect is owned by Progress Shipping Co Ltd-Lib care of Oil Tankers (SCF) Management of Dubai, UAE. As of November 14th the vessel was moored at Zhoushan, China.
2006-built, Liberia-flagged, 57,248 gt NS Century is owned by Gallion Navigation Inc care of Oil Tankers SCF Management of Dubai, UAE. As of November 14th the vessel was en route from Yeosu, South Korea, to Vadinar, India, ETA November 25th.