Shandong ports shut doors on U.S.-sanctioned shadow fleet
The Shandong Port Group in China's Shandong Province will block tankers affected by U.S. sanctions from using its ports. Despite its declared neutrality in the Russia-Ukraine conflict, Beijing opposes sanctions on Moscow.
Shandong Port Group (SPG), the owner of key ports in China's Shandong Province, announced that it would block tankers from the so-called shadow fleet, which is subject to U.S. sanctions. The shadow fleet will not be able to use its facilities. This decision affects the ports in Yantai, Rizhao, and Qingdao. While declaring neutrality in the Russia-Ukraine conflict, the authorities in Beijing oppose sanctions imposed on Moscow.
According to information disclosed by Reuters, SPG has issued a notice prohibiting the acceptance, unloading, and servicing of vessels listed by the Office of Foreign Assets Control (OFAC) of the U.S. Department of the Treasury. OFAC has sanctioned many tankers from the shadow fleet used for smuggling oil from Russia, Iran, and Venezuela.
The Biden administration plans to introduce new sanctions against the Russian "shadow fleet" and Chinese banks involved in transactions related to Russian oil. These restrictions will affect tankers transporting oil priced above $80 per barrel.
Shandong Province hosts numerous refineries, the largest importers of crude oil from countries subject to the U.S. embargo. Last year, about 277 million litres of oil flowed into China daily through local ports, accounting for 17 percent of the national import. Traders cited by Reuters note that the ban may slow down oil imports and increase costs if refineries decide to use tankers not subject to sanctions.
Russia under sanctions
In response to increasingly widespread sanctions, Russia is developing a strategy of cooperation with China. Despite its announced neutrality, China is actively participating in economic exchanges, helping Russia evade international sanctions. The U.S. administration continues efforts to counter these practices and limit Russia's influence on the global energy market.
The shadow fleet consists of approximately 670 vessels, of which 250 to 300 are used to transport resources from Russia. However, SPG anticipates that the navigation ban will have a limited impact on independent refineries because most oil is transported on tankers and is not subject to sanctions.
Despite the sanctions' partial effectiveness, the West faces the challenge of strengthening its long-term efficiency. Energy expert Wojciech Jakóbik emphasizes that sanctions are long-term processes that only bear fruit over time. The ruble crisis and Russia's economic problems show that these actions have effects, although they are not yet a final solution.
