KCS Group Europe Says Transporting Russian Oil Remains Big Business – But Tracking Traders Is More Opaque

Oil production and extraction in Russia. Oil pump jack and oil barrels with Russia flag. 3d illustration

Intelligence Provider Says ‘Dark Fleet’ Moving Russian Oil

Intelligence provider KCS Group Europe (KCSGE) says the movement of Russian oil has become much more opaque with the introduction of sanctions and a number of previously unknown, but significant, traders have emerged on the global market.

The sanctions cover nearly 90% of Russian oil imports to Europe, and comprised of an embargo on seaborne crude oil imports, petroleum-refined products and introduced a price cap of $60 per barrel for Russian crude.

Importantly, the ban also prohibits EU tankers from transporting Russian crude to third countries and the related provision of technical assistance, broking and insurance services. As a result, many international traders cut their ties with Russia.


KCSGE CEO Stuart Poole-Robb says: “This is a complex issue. Firstly, many states have not signed up to the sanctions, including China, India and the Gulf states and buying Russian oil is not illegal.

`’But some practices, such as ship-to-ship transfers and onward movement under murky ownership and flags of convenience, may be assisting Russia to move its oil around the world.”

“Recent data compiled by Lloyd’s List suggests that Greek-based beneficial owners accounted for 31% of tankers calling at five Russian ports in February 2023, with oil-price compliant cargoes.”


However, tankers from the so-called ‘dark fleet’ made up the bulk of shipments, accounting for 79 of the 168 tracked vessels – some 48%. This was the highest percentage in the nine months since Lloyd’s List began monitoring.

The company defines ‘dark fleet’ tankers as those which are over 15 years old, used for sanctioned oil trades, with beneficial ownership obscured behind anonymous or shelf companies and engaged in deceptive shipping practices.

The company says around 40% of the dark fleet can be tracked directly to Russian oil shipments, including large vessels which engage in ship-to-ship transfers in international waters and do not call at Russian ports.

ForeignPolicy.com alleges that this growing fleet of ‘ghost’ ships, that cannot be traced and are uninsured, not only potentially breach sanctions, but represent a threat to maritime safety and the environment.

Moreover, an investigation by Bloomberg has uncovered a number of previously unknown companies, registered in Hong Kong and Dubai, which have entered the market to become major commodity traders and are thought to be handling up to 1.4m barrels per day.


Poole-Robb says: “To put that figure into context, it exceeds the levels of oil transported by global giants like Trafigura prior to the Ukraine war.

“Flag-hopping and the repeated changing of registries, together with the formation of different companies and new names, can be used by sanction-skirting tankers. Using such flags not only keeps the owners one step ahead of the regulators, but allows them to hide in plain sight.

“Who ultimately owns these companies and how they’re able to finance the movement of oil remains for the moment shrouded in mystery.”


Image: Stock image of an oil tanker, Deposit Photos.