The Price Cap Coalition released a Maritime Safety Advisory, emphasizing responsible trading in the maritime oil industry and compliance with the price caps.
The Advisory, which is directed at both government and private sector actors involved in the maritime trade of crude oil and refined petroleum products, provides recommendations concerning specific best practices and reflects our commitment to promoting responsible practices in the industry, preventing and disrupting sanctioned trade, and enhancing compliance with the price cap.
The United States is part of an international coalition (the Price Cap Coalition), including the G7, the European Union, and Australia, that have agreed to prohibit the import of crude oil and petroleum products of Russian Federation origin. These countries have also agreed to restrict a broad range of services related to the maritime transport of crude oil and petroleum products of Russian Federation origin—unless that oil is bought and sold at or below the specific price caps established by the Coalition or is authorized by a license.
This policy is known as the “price cap.” The price cap is intended to maintain a reliable supply of crude oil and petroleum products to the global market while reducing the profits the Russian Federation earns from oil after its own war of choice against Ukraine inflated global energy prices.
All Coalition members are dedicated to enforcing the price cap, as noted in the Coalition statementregarding this U.S. action, and to promoting responsible practices in the maritime oil industry, as outlined in the Coalition Advisory for the Maritime Oil Industry and Related Sectors.
In a related action, OFAC is imposing sanctions on two entities and identifying as blocked property two vessels that used Price Cap Coalition service providers while carrying Russian crude oil above the Coalition-agreed price cap.
Treasury’s Office of Foreign Assets Control OFAC is imposing sanctions on two entities and identifying as blocked property two vessels that used Price Cap Coalition service providers while carrying Russian crude oil above the Coalition-agreed price cap.
The crude oil price cap took effect in December 2022 with a cap on Russian crude oil at $60 per barrel. The SCF Primorye carried Novy Port crude oil priced above $75 per barrel from a port in the Russian Federation after the crude oil price cap took effect. United Arab Emirates-based Lumber Marine SA is the registered owner of the SCF Primorye.
As described in OFAC’s April 17, 2023 Alert, OFAC is also aware of reports that Eastern Siberia Pacific Oil (ESPO) and other crudes exported via Pacific ports in the Russian Federation, such as Kozmino, may be trading above the price cap and may be using covered services provided by U.S. persons. OFAC continues to monitor this activity closely. The YasaGolden Bosphorus carried ESPO crude oil priced above $80 per barrel after the crude oil price cap took effect. Turkiye-based Ice Pearl Navigation Corpis the registered owner of the Yasa Golden Bosphorus.
Both the SCF Primorye (IMO 9421960) and the Yasa Golden Bosphorus (IMO 9334038), which conducted port calls in the Russian Federation, used U.S.-based service providers while transporting the Russian origin oil.
Lumber Marine SA and Ice Pearl Navigation Corp were both designated pursuant to Executive Order 14024 for operating or having operated in the marine sector of the Russian Federation economy. OFAC also identified the SCF Primorye and the Yasa Golden Bosphorus as property in which Lumber Marine SA and Ice Pearl Navigation Corp, respectively, have an interest.
The Department of the Treasury's Office of Foreign Assets Control (OFAC) is publishing a Maritime Oil Industry Advisory.
Date: October 12, 2023
Background: The Price Cap Coalition has issued an advisory to provide recommendations on best practices for the maritime oil industry. The objective is to promote responsible practices to prevent sanctioned trade, enhance compliance with the price caps on oil products of Russian origin set by the G7, EU, and Australia, and to address the increased risks from recent developments in the maritime oil trade.
Increased Risks:
Recommendations:
Additionally, OFAC is issuing Russia-related General License 73, "Authorizing Limited Safety and Environmental Transactions Involving Certain Persons or Vessels," imposing sanctions on two entities and identify vessels as property in which those entities have an interest. These entities own vessels that used Price Cap Coalition service providers and that carried Russian crude oil above the price cap limit.
Treasury Releases:
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