US to Sell Sanctioned Tankers to Cut Oil Shipping Costs
White House plan converts shadow fleet vessels into legitimate tonnage through S&P deals to ease freight rates.
The U.S. government has unveiled a plan to ease sanctions on tankers operating in the so-called shadow fleet, aiming to alleviate the high costs of shipping oil across long distances. Energy Secretary Chris Wright revealed the details to Bloomberg, explaining that sanctions will be lifted for vessels sold to new owners and redeployed in legitimate oil trades.
The initiative centers on sale-and-purchase agreements. A sanctioned tanker, currently restricted from U.S. financial systems and ports, can have its designation removed once acquired by a new owner and assigned to non-sanctioned cargo routes. Wright described the process as shifting vessels from the “bad-guy fleet” to the “good-guy fleet,” ensuring they no longer transport sanctioned oil.
Mechanism for sanctions relief: shadow fleet sanctions
The policy does not involve blanket sanction removals but instead focuses on reclassifying individual ships. In the current high-demand market, shadow-fleet owners could secure significant profits by selling older vessels, with some aging tankers fetching up to $100 million, four times their 2021 value.
Brent Crude
The move responds to persistent constraints in tanker availability, despite efforts to maintain oil flows through the Strait of Hormuz. While attacks by Iran have not halted transit, with 10 million barrels per day still moving through the strait, shipping costs remain elevated, keeping benchmark oil prices above $100 per barrel. Industry analysts, including Philip Damas of Drewry Supply Chain Advisors, caution that the relief may have limited impact on oil prices unless broader restrictions on crude exports from Iran, Russia, and Venezuela are also addressed.
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