Bloomberg reports that evidence suggests Russia is creating a shadow fleet for LNG, similar to its oil strategy to avoid sanctions.
According to Bloomberg, ownership of at least eight vessels has shifted to obscure companies in Dubai, including four ice-class carriers approved to navigate Russia’s Arctic waters. The patterns of these maneuvers—using opaque companies and aging ships—mirror Russia’s approach with its oil fleet. Notably, the LNG market is smaller and more specialized, making such shadow operations unusual and more traceable.
What is the dark/shadow fleet?
The “dark fleet” or “shadow fleet” comprises primarily older tankers, many of which have not undergone recent inspections and lack proper maintenance. Ownership of these vessels is often unclear, and they frequently operate without adequate insurance coverage, seeking to evade sanctions and mitigate high insurance costs. This increases the risk of oil spill or collision. This could also result in a participating shipowner evading its liability under the relevant liability and compensation treaties.
One highlighted vessel, the Asya Energy, exemplifies the trend. Renamed in May, it navigates without a known insurer and is managed by an obscure company based in a UAE free trade zone notorious for its lack of transparency. Three other LNG carriers managed by the company follow a similar pattern. Meanwhile, four ice-class vessels transferred to a company in Dubai have also raised concerns, with Russia approving their Arctic navigation this summer, Bloomberg reports.
The technically demanding and smaller LNG fleet is easier to monitor, and LNG transshipment is more complicated than oil. However, with European ports tightening restrictions, Russia is exploring alternative routes and methods, including ship-to-ship transfers.
