Russian sanctions heighten threat of oil spill disaster, shipping insurer warns
The chief executive of one of the world’s biggest shipping insurers has warned of the growing risk of a disastrous oil spill after the knock-on effects of sanctions on Russia left thousands more ships without third-party liability cover from “well-tested” insurers.
“Nobody will be there to help clear up the mess [without sufficient liability cover],” said Rolf Thore Roppestad, chief executive at Norway’s Gard. “This is a social and environmental disaster waiting to happen, and it should be a big worry for all of us.”
“We have changed the logistics skill set around Russian oil in a very short period of time,” said Ben Luckock, co-head of oil trading at Trafigura, about the growing prominence of smaller, less experienced trading firms relying on older vessels. Trafigura was one of the biggest lifters of Russian crude before it wound down that business last year.
A big area of concern, he said, are the straits between Denmark and Sweden at the mouth of the Baltic Sea, which remains an important trade route for sanctioned Russian oil that now bypasses Europe on its long journey to new buyers in India and China.
“You have a lot of 17, 18 and 19-year-old boats transiting the Danish straits with [Russian] oil destined for Asia,” Luckock told the FT Commodities global summit last week.
This story originally appeared on: Financial Times - Author:Ian Smith
