Stopping Russia’s Shadow Fleet

The Shadow Fleet as a Pressure Point

The term "shadow fleet" refers to the internationally dispersed network of mostly aging tankers, along with associated shipping companies, insurers, and intermediaries that have helped Russia circumvent Western sanctions and the G7 oil price cap since 2022. Parts of this network have also been linked to espionage activities and the damage of critical undersea infrastructure.

These vessels typically operate through opaque ownership structures registered in third countries, frequently change names and flags, carry insufficient insurance coverage, and rely on the deactivation or manipulation of identification systems as well as ship-to-ship transfers to obscure their movements and ownership.

Given the fluid composition of the fleet, its exact size is difficult to determine. Estimates range from roughly 500 to 3,000 vessels worldwide. Its economic importance to Moscow is substantial. According to recent estimates, the shadow fleet now accounts for approximately 70 percent of Russia's seaborne crude oil exports and generates around USD 85 billion in annual revenue. Most of this oil is sold to buyers in Asia.

Freedom of Navigation?

The legal options for intervention at sea are limited. Beyond territorial waters, the principle of freedom of navigation generally applies. Except for a limited number of specific circumstances within Exclusive Economic Zones (EEZs), vessels are subject primarily to the jurisdiction of their flag state.

Within German territorial waters, Germany exercises sovereign authority, albeit subject to the right of innocent passage. Enforcement measures therefore require a specific legal basis, such as violations of flag-state regulations or breaches of environmental and maritime safety standards. Existing measures of EU member states against individual shadow fleet vessels are based on these legal grounds.

Systematic Countermeasures

As a critical source of revenue for the Russian state, the shadow fleet can nevertheless be targeted effectively through civilian, law-enforcement, and diplomatic means. The experiences of Sweden, the United Kingdom, and Norway demonstrate that a more robust and comprehensive approach is possible. Such an approach combines systematic inspections, information-sharing, and targeted interventions while remaining fully consistent with international maritime law.

Germany possesses a range of instruments that could make shadow fleet operations more costly, riskier, and more cumbersome for Moscow while enhancing security in the Baltic Sea region.

• Flagging and Insurance

Increase pressure on flag states and insurers; systematically scrutinize ownership and insurance arrangements; Use diplomatic channels to address states that facilitate the maintenance of shadow fleet networks

• Transit and Maritime Traffic

Expand inspections in a systematic and consistent manner; apply maritime and environmental regulations through a purposive, broad, and legally robust interpretation of existing rules

• Oil Sales and Cargo Handling

Intensify engagement with third countries, transshipment hubs, refineries, and commodity traders to encourage alignment with EU sanctions targeting the shadow fleet; Increase barriers to the re-export of Russian oil and refined petroleum products into the European Union

• Crews

Strengthen efforts to identify and prosecute key individuals where there are credible indications of espionage, sabotage, or other criminal activities

A Coordinated European Approach

A unified and coordinated European strategy is needed to address Russia's shadow fleet as an integrated network rather than merely targeting individual vessels. Only a combination of sanctions, inspections, and measures directed at flag states, shipping companies, insurers, and transshipment hubs is likely to produce lasting effects.

As long as Germany primarily treats the shadow fleet as a legal, economic, and environmental challenge, the European Union is well placed to continue serving as the coordinator of such an approach. The objective should be to significantly increase the costs and risks associated with operating the shadow fleet, thereby constraining an important component of Moscow's hybrid activities without resorting to military means.