In a sign that sanctions on Russia over the war in Ukraine may be starting to bite, Russian tanker ships carrying oil and petroleum products have been observed turning off systems that broadcast their identity and location, a practice known as "going dark" and which is often associated with efforts to evade sanctions.
In the days and weeks after Russia invaded Ukraine, the United States and a broad coalition of other countries imposed sweeping sanctions on Russian goods, including petroleum products. Experts say that by going dark, ships may be able to discharge cargo, often via ship-to-ship transfers at sea, without attracting the attention of law enforcement authorities.
According to data gathered by Windward Ltd., an Israeli firm that uses artificial intelligence to assess maritime risk, the number of incidents of Russia-affiliated ships going dark on a daily basis has increased dramatically since the introduction of sanctions.
This is especially true with regard to tankers carrying Russian crude oil. Prior to the invasion, Windward tracked two or three incidents per day of tankers loaded with Russian crude disabling their identification systems. It is now documenting about 20 a day.
"We're seeing a synchronized effort across Russian shipping and trading to systemically hide where their cargoes are going," Ami Daniel, Windward CEO, told VOA.
That is not to say the practice of "going dark" is being dictated by the Kremlin. The ships involved are almost all privately owned and not technically answerable to the government in Moscow. Neither the Russian government nor the various companies who own the ships in question have issued public statements about the practice.
Automatic Identification System
A treaty, known as the International Convention for the Safety of Life at Sea, requires large ships to have an Automatic Identification System (AIS) in operation at all times, with some specific exceptions. The AIS provides other ships and coastal authorities with the vessel's name, heading, speed and other information.
"AIS should not be turned off, as a general matter," Attorney Neil Quartaro, a partner in the trade and transportation group at the law firm Cozen O'Connor, told VOA.
Quartaro said that the few exceptions include areas where broadcasting details about a ship's speed and heading could create a security risk.
"The primary area where it is acceptable to turn off your AIS is in something called the 'high risk area,' which is essentially the area off the coast of Somalia," Quartaro said. Pirate activity is prevalent in that region, as well as a few other spots around the world, where cargo ships have been boarded and the crews held for ransom.
Ship-to-ship transfers
Quartaro said that it is not uncommon for ships attempting to evade sanctions to turn off their AIS equipment while, for instance, performing a ship-to-ship transfer of crude oil that originated in a sanctioned country.
"If you're operating in the Gulf of Mexico, and you're anywhere close to Trinidad and Tobago or Aruba, and you turn off your AIS, anybody looking at that is going to suspect that you're engaging in an illegal transfer of oil product out of Venezuela, which happens all the time," Quartaro said.
Similarly, he said, it is common for empty tankers to leave a port in the Middle East, turn off their AIS equipment, and then reappear a few days later with a load of crude oil bound for Pakistan. In such cases, he said, the oil probably originated in Iran, which is under heavy sanctions.
Deceptive shipping practices
In 2020, the U.S. departments of State and Treasury, as well as the Coast Guard, issued an advisory that included seven different shipping practices that were characterized as "deceptive" and associated with illicit shipping and the evasion of sanctions.
No. 1 on the list is disabling or manipulating AIS equipment.
"Although safety issues may at times prompt legitimate disablement of AIS transmission, and poor transmission may otherwise occur, vessels engaged in illicit activities may also intentionally disable their AIS transponders or manipulate the data transmitted in order to mask their movement," the advisory warned.
Others deceptive practices include falsifying registrations and cargo manifests, creating intentionally complex ownership structures, and making unscheduled stops and detours.
Sign of desperation
The potential downside of engaging in deceptive shipping practices is significant, which suggests that willingness to engage in it could be a sign of desperation.
Large companies that have significant business interests in the United States, for example, do not want to get caught up in an investigation of sanction evasion. For that reason, they pay companies like Windward to identify vessels that have engaged in suspicious activity, in order to avoid doing business with them in the future.
However, the importance of oil exports to the Russian economy may make some shippers more willing to take risks.
Russia's exports of petroleum products are a large contributor to the economy. In 2021, according to figures released by the Russian central bank, the country took in $490 billion from petroleum sales. Crude oil accounted for $110 billion of the total, and other oil products made up an additional $69 billion.
Daniel, of Windward, said his company expects to see Russian shippers resorting to additional methods of bypassing sanctions in the near future.
"We expect Russia to adopt many of these deceptive shipping practices, and not just in the tanker segments. Across all the segments, because of the huge pressure they're under," he said.
