- Russia is using non-sanctioned vessels and rerouting others to keep exporting oil, per maritime data.
- Western countries have imposed sanctions on Russia's "shadow fleet" to try to reduce its oil revenues.
- Russia is now risking sanctions on more ships, economists and energy experts told Business Insider.
Russia is increasingly relying on non-sanctioned vessels to try to maintain its oil exports, but is putting those ships at risk of being sanctioned too.
Russia has relied heavily on a "shadow fleet" consisting of often aging, uninsured vessels to evade international sanctions.
Last month, the US Treasury announced sweeping sanctions on 183 Russian-controlled ships, affecting more than two-thirds of tankers servicing Kozmino, Russia's key oil export hub in the country's Far East.
Russia's shadow fleet has an estimated 1,300 ships, but once a vessel is sanctioned, most ports will likely refuse to unload it, forcing Russia to find a replacement, Petras Katinas, an energy analyst at the Center for Research on Energy and Clean Air, told Business Insider.
"Moscow now faces the challenge of acquiring many new tankers to sustain its export flows," Katinas said.
Western countries have rolled out sanctions on Russia's shadow fleet in recent months, in an effort to stifle oil shipments and limit the country's ability to maintain its invasion of Ukraine.
Energy and sanctions analysts told BI that Russia's use of non-sanctioned vessels should come as no surprise, and nor should the risks.
Barbados and Panama delisted more than 100 sanctioned Russian ships last month alone.
Benjamin Hilgenstock, a senior economist at the Kyiv School of Economics, said that Russia risks losing significant oil revenue.
With Russia's largest crude oil export trading at around $70 per barrel — $10 per barrel above the G7's price cap — "every single load of 650-675k barrels means $6-7 million in additional export earnings," Hilgenstock said.
He pointed to the Breeze III oil tanker, which was loaded with 660,000 barrels of oil for the first time last month at the Russian port of Ust-Luga on the Baltic Sea, according to ship-tracking data from Kpler.
Per Kpler's data, tankers are also now operating in the Pacific region, including the Suvretta, which made a port call at Kozmino over the weekend and loaded more than 670,000 barrels of crude oil before heading to China, and the Bhilva, which appeared to be on its way to Kozmino from Singapore on Tuesday.
Hilgenstock said that every sanctioned ship removed from operations means significant costs for its operator, and that Western countries can sanction each new ship that enters the fleet.
"While designations have now reached a quite substantial level — around 275 ships sanctioned in one or more jurisdictions according to our count — the job is not done yet," he said.
Even so, analysts believe Russia will continue to look for ways to export oil, given its importance to the country.
Oil and gas revenues accounted for about 30% of Russia's federal budget in 2024, Alexander Novak, Russia's deputy prime minister, said in Energy Policy last week.
And Russia is gearing up to spend the equivalent of $126.8 billion on national defense this year, 32.5% of its federal budget.
Gonzalo Saiz Erausquin, a research fellow at the Royal United Services Institute's Centre for Finance and Security, said the G7 and countries close to it "have to remain vigilant and dedicate huge efforts in identifying shadow fleet vessels."
Meanwhile, he said, oil revenue remains Russia's "lifeline" when it comes to its war in Ukraine.
"They will continue investing, hopefully increasingly incurring higher costs, to keep exporting that oil," he added.
