Traders have shifted their strategy for moving Russian diesel cargoes, utilizing a new ship-to-ship (STS) loading site in the northern Aegean Sea. This change comes as Western sanctions continue to target vessels carrying fuel from Russian ports, according to data from LSEG and market sources.
Sanctions and Diversion of Russian Oil
Since the European Union (EU) imposed a full embargo on importing Russian oil products in February 2023, traders have redirected diesel exports from Russia to countries such as Brazil, Turkey, and various nations in Africa and Asia. A significant portion of this trade now occurs through STS loadings, which complicate efforts by Western countries to trace the movement of Russian oil products.
One of the most favored STS locations in Europe has been the international waters off Greece’s Laconian Gulf. This area is strategically located near Russian ports and provides access to Asian markets via the Suez Canal.
Shifting STS Locations Due to Military Exercises
In April, Greece issued warnings for military exercises in the Laconian Gulf, advising merchant vessels to avoid the area. Consequently, tankers carrying Russian oil products began relocating from the southeastern Peloponnese to Malta and Port Said in northern Egypt.
By July, at least four vessels carrying approximately 123,000 metric tons of diesel and gasoil from Russia’s Black Sea ports of Taman and Tuapse were directed to neutral waters south of the Greek island of Chios for transshipment. So far in August, three more vessels loaded with a combined total of around 100,000 tons of gasoil from Tuapse have also been heading toward STS operations in the northern Aegean.
Impact of New EU Sanctions
The recent uptick in STS activity may also be linked to the latest EU sanctions. In June, the EU adopted its 14th package of sanctions against Russia, aimed at disrupting the so-called “shadow fleet” of foreign vessels transporting Russian oil products. Despite these efforts, Russia continues to export around 3.5 million metric tons of low-sulfur diesel and gasoil each month.
The ongoing shift in STS locations and the persistence of Russian oil exports highlight the complexities and challenges faced by Western countries in enforcing sanctions and tracking the flow of Russian energy products.
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