US Warns Companies Over Russian Oil Price Cap Evasion Via ESPO Pipeline
(Reuters) — The U.S. Treasury published a warning to U.S. companies on Monday of possible evasions of the Russian oil price cap exported through the Eastern Siberia Pacific Ocean (ESPO) pipeline and ports in eastern Russia.
The Office of Foreign Assets Control (OFAC) at the department said it is aware of reports that ESPO and other crude oils exported via Pacific ports, such as Kozmino, may be trading above the $60 price cap imposed on Russia by Western countries, and that U.S. entities may have unknowingly provided services for those trades.
The Group of Seven countries, including the United States, and the EU have placed the cap on Russian shipments of crude oil since late last year as part of sanctions on Russia following its February 2022 invasion of Ukraine.
"These U.S. service providers may be unaware that they are providing covered services involving Russian oil purchased above the price cap, as the non-U.S. persons involved in the exports may have provided incomplete or false documentation or used other deceptive practices," OFAC said in the warning.
Under the price cap scheme, companies in the G7 countries and the EU are allowed to provide financial services such as transportation, insurance and financing services for Russian oil and oil products only if they are sold above the cap.
OFAC said some tankers may be manipulating their automatic identification systems, a practice known as spoofing, to hide their calls at Kozmino or other ports. Spoofing can also mask ship-to-ship transfers to disguise the origin of Russian oil.
The office said shipowners and other service providers can use records and attestations by oil market players that Russian oil they service was purchased below the cap to avoid enforcement actions.
The warning told commodities brokers and traders that shipping, freight, and insurance costs are not included in the price caps, but that failure to itemize such costs can be used to hide purchases of Russian oil above the cap. OFAC also recommended that traders retain documents showing that Russian oil and oil products were bought at or below the cap.
Related News
Related News
- Phillips 66 to Shut LA Oil Refinery, Ending Major Gasoline Output Amid Supply Concerns
- FERC Sides with Williams in Texas-Louisiana Pipeline Dispute with Energy Transfer
- U.S. Appeals Court Blocks Kinder Morgan’s Tennessee Pipeline Permits
- ConocoPhillips Eyes Sale of $1 Billion Permian Assets Amid Marathon Acquisition
- Valero Considers All Options, Including Sale, for California Refineries Amid Regulatory Pressure
- U.S. Appeals Court Blocks Kinder Morgan’s Tennessee Pipeline Permits
- Malaysia’s Oil Exports to China Surge Amid Broader Import Decline
- U.S. LNG Export Growth Faces Uncertainty as Trump’s Tariff Proposal Looms, Analysts Say
- Marathon Oil to Lay Off Over 500 Texas Workers Ahead of ConocoPhillips Merger
- Valero Considers All Options, Including Sale, for California Refineries Amid Regulatory Pressure
Comments