A group of countries, including the United States, the Group of Seven (G7), the European Union (EU), and Australia, have joined forces to put in place a policy known as the “Russian Price Cap Policy.” This policy affects various services related to maritime transport, particularly those involving the movement of crude oil and petroleum products from Russia, called “Russian Oil.”
he goal of the Russian Price Cap Policy is to ensure a steady supply of Russian Oil to the worldwide market. At the same time, it aims to decrease the income that the Russian Federation earns from selling these oil products.
The effect of the Russian Price Cap Policy is to authorize certain persons engaged in maritime transport, including “Flagging registries,” to provide certain services as they relate to the maritime transport of Russian Oil, including vessel registration and “Flagging” services, as long as the Russian Oil being transported is purchased at or below a certain price cap, set by the Coalition Partners
The price cap for Russian petroleum products has been set at two levels:
- one for “premium-to-crude” petroleum products, such as diesel, kerosene and gasoline, and
- the other for “discount-to-crude” petroleum products, such as fuel oil and naphtha.
The price caps for premium-to-crude products and discount-to-crude products have been set at $100 per barrel and $45 per barrel, respectively, as of 5 February 2023. All price caps are subject to change by the Coalition Partners.
The Republic of the Marshall Island has issued a Marine Notice to explain the aforementioned policy and to highlight that vessels should comply accordingly.
In particular, the Marine Notice reads:
”Registered Owners and Agents of all RMI tank vessels registered with the Administrator represent, warrant, and attest, on a continuing basis to and for the benefit of the Administrator and its agents, that, as a condition of such registration and any attendant flag services requested of the Administrator, the vessel is in compliance with the Russian Price Cap Policy, including the then applicable attestation and recordkeeping requirements of the Russian Price Cap Policy as they pertain to the seaborne transportation of Russian Oil by such vessel.”
As such, the Flag Administration reserves the right, in its sole discretion, to cancel the Certificate of Registry of any RMI registered tank vessel found to be in violation of the Russian Price Cap Policy, including the then applicable attestation and recordkeeping requirements of the Russian Price Cap Policy as they pertain to the seaborne transportation of Russian Oil by such vessel, and/or the representations, warranties, and attestations set forth in this Marine Notice.