Plan would ban providing services, insurance for oil transport
Greece, Cyprus question ban on moving Russia oil outside EU


4 May 2022, 10:35 GMT+1
Updated on4 May 2022, 16:14 GMT+1
The European Union is seeking to go beyond an import ban on Russian crude, targeting insurers in a move that could dramatically impair Moscow’s ability to ship its oil anywhere in the world.

The bloc is proposing to ban European vessels and companies from providing services -- including insurance -- linked to the transportation of Russian oil and products globally as part of its new sanctions package, according to officials and a draft document seen by Bloomberg.

While member states are still wrangling over the terms, it’s a potentially powerful tool because 95% of the world’s tanker liability cover is arranged through a London-based insurance organization called the International Group of P&I Clubs that has to heed European law.
Without such cover, Russia and its customers would have to find alternatives for risks including oil spills and mishaps at sea that can quickly run into multi-billion-dollar claims.

I think we will see insurers being very cautious,” said Daniel Martin, a partner who advises traders, shipowners, insurers and brokers on sanctions at law-firm HFW. “To the extent that the EU has a lever because it has a dominant position in insurance, then I would expect it to use that to make sure the sanctions are as multilateral as possible.”

The cover from the International Group is a basic part of contracts for the transportation of most oil cargoes. The IG, as it’s known, provides reinsurance if claims exceed what the group’s 13 individual member clubs cover.

And there’s precedent: Insurance is one of the key means by which the U.S. and Europe successfully limited Iran’s oil exports. Individual countries responded to those steps by organizing cover directly, although IG insurance is widely preferred by most big companies.

The move -- if implemented in full -- dramatically increases the stakes with Moscow. The insurance measures come on top of the EU’s plan to ban imports of Russian crude and refined products by the end of the year.


https://www.bloomberg.com/news/articles/2022-05-04/eu-aims-to-target-russia-s-global-oil-sales-with-insurance-ban?cmpid=socialflow-facebook-politics&utm_medium=social&utm_campaign=socialflow-organic&utm_source=facebook&utm_content=politics

This won't impact anything.

The Russians already have contingency plans to either circumvent or overcome any Sanctions that the EU or US might put out.

A great percentage of Oil and Gas vessels moving Russian Oil/Gas products are owned by Russian companies. Preventing them from accessing Insurance services from Western companies will simply mean that the Russians will move the insurance of those vessels to Russian insurance companies which will be guaranteed (reinsured) by State funds.

Remember the Sanctions levied against Russia's Aircraft Industry in early March. The hope was that the Russian Air market will get crippled....but guess what, the Russians simply moved all the foreign leased Aircraft to their own Registers and used Russian companies to insure and maintain them.

I'm not saying the Russians are impervious, but they are tough as nails and ingenious as compared to the idiots in the EU/USA.

P.s. Russia also moves a lot of its Oil via pipelines to China, Europe, Kazakhstan and Mongolia. Those pipelines are owned and operated by Russia, how will the Sanctions affect them?

The EU is just bending over backwards to please their masters in Washington. But it is to their own detriment.

Please do! Let the prices of Oil go up as gas is right now.Hungarian PM Orban said that neither Hungary nor the EU as a whole are ready to accept and implement the sanctions proposed by the European Commission against Russian oil.

Drenimarcus:
Please do! Let the prices of Oil go up as gas is right now.Hungarian PM Orban said that neither Hungary nor the EU as a whole are ready to accept and implement the sanctions proposed by the European Commission against Russian oil.

Yes, until they find alternatives. In the future , EU wouldn't be ruling on Russian gas. It would happen gradually.

joyandfaith:


Yes, until they find alternatives. In the future , EU wouldn't be ruling on Russian gas. It would happen gradually.

And Russia wont doesn't have alt? OPEC came out yesterday saying they isn't alt for Russia oil.

Drenimarcus:


And Russia wont doesn't have alt? OPEC came out yesterday saying they isn't alt for Russia oil.

Business deal will happen sooner or later.