Old aframaxes now worth $17.7m more—how sanctions reshaped tanker values
Fifteen-year-old aframaxes trading at 123% above pre-cap baseline after G7 price restrictions on Russian crude.
The G7 price cap on Russian seaborne crude, introduced on December 5, 2022, has reshaped the global tanker market in unexpected ways. While the measure targeted Kremlin oil revenues by capping prices at $60 per barrel, its real impact has emerged in the secondhand vessel market—where the rules of valuation have fundamentally changed.
Researchers Simon Lunde and Fredrick Henriksen of BI Norwegian Business School analyzed this shift by examining vessel prices rather than trade flows. Their findings reveal a broad re-rating of shipping assets, with the steepest premiums appearing in older tankers best suited for sanctioned routes.
The sanctions premium: age and exposure: aframax premium
A fifteen-year-old aframax—the vessel class most commonly used to transport Russian crude from Baltic and Black Sea ports—saw its assessed value rise by $17.7 million in the 39 months following the cap. This represents a 123% increase over its 2018–2021 baseline, according to data from Clarksons Shipping Intelligence Network. The premium isn’t uniform: it grows with vessel age, at a rate of 3.7% per year for aframaxes, 2.8% for suezmaxes, and 1.8% for VLCCs. The pattern aligns with their exposure to Russian trade routes, where older tonnage has become the scarce resource.
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The effect extends beyond crude tankers. A ten-year-old LR2 product tanker gained $16 million, while even a handysize bulker—with no direct crude exposure—saw its value rise by 85%. This suggests the cap’s influence has rippled across the entire shipping sector, not just the segments directly involved in Russian oil transport.
A structural shift in vessel values
The most dramatic change appears in the term structure of vessel prices. The ratio between five-year-old and fifteen-year-old tanker values—a key industry metric—had remained stable at around 2.0–2.2 since 2008. In the three years before the cap, it averaged 2.54, reflecting the traditional premium for newer tonnage. After December 2022, however, the ratio compressed to 1.76, the lowest level since the 2008 financial crisis.
The difference is stark: in 2008, all vessel values fell together. This time, older ships repriced upward while the broader market remained at or near record highs. The data shows that the cap has introduced a new variable—access to sanctioned trades—that now competes with age and earnings in determining vessel values. For brokers, owners, and investors, this means the old rules of valuation no longer apply.
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