The Price Cap Coalition's advisory, released on Oct. 12, outlines critical best practices for maritime oil industry stakeholders. Designed to enhance responsible trading and ensure compliance with price caps on Russian-origin oil products set by the G7, EU and Australia, the advisory pinpoints multiple challenges confronting the sector.
Central to the advisory is the growing "shadow trade" phenomenon. This opaque trading realm, often linked to sanctioned entities, predominantly features older vessels with questionable registration and safety protocols. The advisory emphasizes the financial and environmental repercussions of potential oil spills from these vessels, notably due to their ties with ambiguously regulated insurance providers.
Moreover, the advisory alerts about vessels with convoluted ownership structures that often disable or tamper with the Automatic Identification Systems (AIS), jeopardizing industry trustworthiness. These deceptive undertakings are further complicated by Russia's aggressive stance toward Ukraine, which has prompted a unified global response, including economic sanctions and the notable oil price cap policy.
The advisory emphasizes several pivotal recommendations for the maritime oil industry. It underscores the importance of maintaining continuous and comprehensive insurance from recognized providers. Additionally, vessels are urged to secure accreditation from the esteemed International Association of Classification Societies (IACS). The consistent broadcasting of AIS is advocated, with vigilance for any irregularities. The advisory also stresses the need for close monitoring of ship-to-ship transfers in vulnerable maritime areas, clear and transparent billing practices for shipping-related costs and heightened due diligence, especially when dealing with obscured intermediaries or when Russian oil prices exceed established caps. Furthermore, stakeholders are encouraged to promptly report any suspicious activities or breaches of the oil price cap.
With this advisory, the Coalition aims to reiterate its commitment to ensuring the maritime oil trade remains compliant, safe and operates with utmost integrity.