Russia pivots to Western ships as oil prices plummet
Since oil prices fell below $60 per barrel, a price lower than the cap imposed on Russia by the G7 countries for its invasion of Ukraine, the Kremlin has increasingly utilised Western ships for transportation, thereby reducing the reliance on its "shadow fleet", Bloomberg reported.
According to Bloomberg, the proportion of oil transported by Russia using Western tankers from the Baltic and Black Seas increased to 43% in April, compared to 30% in the first three months of the year.
Oil prices on global exchanges declined after US President Donald Trump imposed high tariffs on imported goods, primarily from China, at the beginning of the month.
In the first week of April, prices for Russian Urals oil fell to their lowest levels since 2023. For oil loaded at the ports of Primorsk and Novorossiysk, the cost was approximately $53 per barrel.
When prices exceeded the $60 per barrel threshold, Russian oil could not be transported by tankers owned by Western companies. This situation forced Russia to rely on older ships, owned by obscure companies, flying flags of countries not conventionally associated with large maritime fleets; even—as in the case of Lesotho—those without access to the sea.
The oil price cap has been in place since 2022
Since the introduction of the price cap in December 2022, the "shadow fleet" has managed the majority of Russian oil exports.
The oil price cap of $60 per barrel was introduced in December 2022 by the G7, the European Union, and Australia in response to Russia's invasion of Ukraine.
