Windward: Deceptive shipping practices and dark activity multiply

Windward published a report focusing on dark activity and deceptive shipping, trade of sanctioned Russian crude oil, and trade flow in the Black Sea since the beginning of the Russia-Ukraine conflict.

Deceptive Shipping Practices & Vessels Going Dark

Windward’s proprietary, AI-driven data revealed a growing trend of Russian oil majors selling away their vessels to non-Russian companies.

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Since the beginning of the invasion, there were 180 ownership changes from Russian entities to non-Russian entities. This number represents 53% of the total ownership changes that took place in all of 2021.

Some of these vessels were sold to companies based mostly in Turkey, Singapore, United Arab Emirates, and Norway. The same places that housed the top buyers of Russian-affiliated vessels before the war.
Hong Kong was one of the leading countries in terms of its companies buying Russian-affiliated vessels in 2021, but since the invasion, they only bought one. On the contrary, Latvian companies, who only bought two vessels in 2021, have already bought six Russian-affiliated vessels since the beginning of the invasion. This is in addition to five more ownership changes from Russian to Latvian entities.

Windward insights also show a significant and steady increase in dark activity by Russian-affiliated oil tankers since the beginning of the Russian invasion of Ukraine, due to the series of moral restrictions and official sanctions that emerged.

Before sanctions were put into place, the average number of dark activities by Russian-affiliated oil tankers was 1.9 per day.
That number has since more than tripled to a daily average of 6.3 dark activities.
Before the invasion and subsequent sanctions, Russian crude oil tankers were barely involved in dark activities, with a weekly average of 1.1 such activities per week. Between February 24 and May 24, that number skyrocketed to 10.75 dark activities on average per week!

Trade of sanctioned Russian crude oil via STS operations

The number of ship-to-ship (STS) operations between crude oil tankers after one of the vessels called port in Russia is currently at 50 (from February 24 until May 24). For comparison, during the same three-month period in 2021 there were a total of 34 such STS meetings between crude oil tankers.
These 50 meetings were carried out by 35 unique crude oil tankers that have already delivered an estimated 27,500,000 barrels of Russian crude oil.
The cargos of crude oil tankers from Russia have arrived in Asia, countries within Europe, and the U.S.
41.8% of sanctioned Russian oil is going to China, the majority of it through two main STS hubs – Denmark (three meeting events) and South Korea (six meeting events).

Black Sea Trade Flows

Even before the European Commission’s sanctions announcement, the invasion had a great effect on general trade flow in the Black Sea.

To further investigate the shift in trade, we compared the last status image (April-May 2022) to the same timeframe in 2021. It seems like the commercial activity in the area has actually increased since 2021, but changed course, as almost no vessels go north of Romania.
There was a spike in commercial port operations by tanker and cargo vessels in Romania and Bulgaria during the first few weeks after the invasion. But it seems that as the conflict continues, business is going back to normal and port calls are back at their usual rate in all Black Sea ports.
In March-May 2021, the monthly average number of port calls in the Black Sea area was 3,481. During the same time period of 2022, that monthly average only went down by 17.5% to 2,870 port calls per month.
Diving into the sub-class details for the same timeframe shows that port operations decreased by 16% for bulk carriers, by 46% for container vessels, and by 20% for general cargo vessels – clearly disrupting the wheat export trade flows from Ukraine and the area (trade lines that usually use these types of vessels).
On the contrary, crude oil tankers saw a 25% increase in port operations in the area when comparing March-May of 2021 to March-May 2022.
The country that has suffered the most commercial damage so far is of course Ukraine, with a 36% drop in its monthly average of commercial port calls compared to 2021.
When we deep dive into the Windward data on Ukrainian ports, we see yet another effect of the invasion on the trade flows in the area. The data clearly indicates that Izmail, a minor port near Romania, has adapted to the new trade landscape and has been stepping up to keep international trade flowing.
In March-May 2021, Izmail port had 337 port calls by international tankers and cargo vessels. This number increased to 494 during the equivalent period in 2022.

No matter how severe the penalties, some Russian-affiliated entities will continue to try to evade sanctions and sell Russian crude oil, etc. They will likely change up their evasion methods and seek out loopholes. Predictive intelligence will continue to increase in importance for the maritime sector

Windward stated.