Turkey warned the world’s oil shippers they will need to prove they’re insured to cross the country’s vital straits, a move that could restrict flows of Russian oil as new European sanctions kick in.
The new rule starts Dec. 1, a few days before the European Union and UK impose additional curbs on Russian trade that will make it much harder for tankers carrying the nation’s oil to get insurance. Because the insurance covers everything from oil spills to collisions, Turkey is in effect seeking to protect its waters, but it could also affect the flow of millions of barrels of Russian crude exports.
Ships hauling oil through the waterway and the nearby Dardanelles strait will be required to provide a letter from their insurer saying that cover will be provided for that specific vessel voyage and cargo, the Turkish Ministry of Transport said in a circular.
The European Union and the UK commence aggressive sanctions on Russian oil shipments on Dec. 5 that will dramatically affect the availability of industry standard insurance. Russia shipped almost 650,000 barrels a day of its own oil through the straight from its Black Sea port of Novorossiysk over the past six months, loading programs compiled by Bloomberg show. A nearby Russian port exported almost 1.3 million barrels a day of cargo from Kazakhstan.