Donald Trump readies fresh US sanctions against Russia’s shadow fleet

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Donald Trump’s administration is considering additional sanctions on Russia’s “shadow fleet” of oil tankers if President Vladimir Putin does not agree to a ceasefire in Ukraine by Friday.

Blacklisting vessels in the fleet would mark the first time the US has imposed sanctions aimed at Moscow since Trump returned to the White House in January.

Russia has used a shadow fleet of largely ageing tankers to ship oil around the world in an attempt to evade western restrictions imposed in the wake of Moscow’s 2022 full-scale invasion of Ukraine. Proceeds from these crude exports have helped to finance the conflict.

The term “shadow fleet” refers to vessels whose ownership is hidden and which avoid using services from western companies. Enforcing sanctions against their owners is difficult, although measures targeting the ships themselves have recently proven effective.

Two people familiar with the White House’s deliberations said additional US sanctions on the shadow fleet were seen as an easy first step to impose costs on Russia. A third person close to the administration said it was considering a range of options, including sanctions on the fleet.

Joe Biden’s administration added 213 crude, chemical or product tankers to the sanctions list. Trump has held off imposing further sanctions on Russia in an effort to secure a negotiated settlement to end the war.

But he has grown increasingly frustrated with Putin’s refusal to agree to a ceasefire, and gave the Russian leader an ultimatum to change tack by Friday or face tougher sanctions.

Further US penalties on the fleet would bolster the EU’s recent steps against the fleet, said Kevin Book, managing director of research with ClearView Energy Partners. The bloc sanctioned more than 100 ships last month, bringing the total to 415.

Under the terms of the sanctions regime, western-linked companies are prohibited from buying seaborne oil priced above a G7 price cap fixed at $60 a barrel for crude. The shadow fleet has allowed Russia to ship oil above the cap — mainly to China and India.

In early 2024, Biden administration officials were surprised to realise that listing individual ships — rather than their owners or managers — proved to be effective, with buyers of Russian oil reluctant to deal with vessels that had been named. The EU and UK took up the practice as a result.