By Weilun Soon
Feb 28, 2025, (Bloomberg) –An aging oil tanker sanctioned by the US is being taken apart in an Indian scrapyard, a potential watershed moment for the so-called dark fleet in a rapidly changing geopolitical landscape.
Nolan, a Suezmax vessel built in 1998, is in Alang, a major ship-breaking center in Gujarat in western India. It was sanctioned in 2019 for carrying Iranian oil, and was previously one of hundreds of blacklisted tankers that can still be found plying shipping lanes or idling in oceans across the world, posing risks to maritime and environmental safety.
Many of these ships are far older than the regular fleet, yet they’ve not been scrapped due to demand to transport Russian and Iranian oil, and also because scrapyards and cash buyers are reluctant to become involved for fear of the reputational and economic repercussions.
Now, several years of sluggish business have changed the way shipbrokers and scrapyard owners see the fleet and the opportunities it presents. Washington’s targeting of these vessels helping Moscow and Tehran in recent months have caused some ships such as Nolan to sit idle at sea after being blacklisted, prompting their owners to consider scrapping them for some monetary returns.
At the same time, ship-breaking companies are nervous about taking sanctioned vessels for demolition, for fear of being penalized. Some have tried to seek clarification from Washington in recent weeks, without receiving clear answers.
Nolan hadn’t been on any commercial voyages for nearly a year, and was idling in and around the Persian Gulf for months before making its way to Alang in January, according to data complied by Bloomberg. South Asia has the world’s biggest ship scrapyards and competition is the fiercest in Alang, given the large number of firms there.
Shipbrokers said that more sanctioned tankers may soon follow Nolan to Alang, including the Bluefins that’s now anchored offshore. The Amor, the first dark fleet very large crude carrier to have been earmarked for scrapping, was at a cleaning yard in Indonesia last week, people familiar with the matter said.
Ship-scrapping yards “are starved of tonnage, and if eventually one of them takes a risk, more will open up themselves to the idea of scrapping sanctioned ships,” said Andrew Wilson, head of research at BRS Shipbrokers. “These are tough times for them.”
President Donald Trump’s tough approach toward Iran in his first term, and then the tainting of Russian oil following the invasion of Ukraine in early 2022 provided a second wind for a lot of vessels that would otherwise have been broken up. Only 409 ships were scrapped last year, the least in NGO Shipbreaking Platform data that goes back to 2012.
However, Trump’s pivot toward Moscow in recent weeks may make the transport of its crude easier, leading to the downsizing of the dark fleet.
“There are so many owners trying to send these vessels for recycling but they can’t find ways to do it,” said Hitesh Vyas, a vice president at Wirana Shipping Corp., a company that buys old ships and arranges for them to be scrapped. “They want to recycle them, but they can’t find any exit route.”
The Nolan, previously called the Solan, was renamed in January, data from Equasis show. It was sanctioned late in Trump’s first term, when the US Treasury took aim at a network of tankers that it said was directed by, and financially supported Iran’s Islamic Revolutionary Guard Corps-Qods Force and the militant group Hezbollah. The ship used to sail under the Iranian flag, but as of January it had switched its flag to Sint Maarten, a Dutch territory in the Caribbean, according to Equasis.
Nolan’s most recent commercial voyage was in April 2024 when it sailed from Iran’s Kharg Island to waters off the United Arab Emirates, likely to engage in a ship-to-ship transfer, data from Vortexa show. Such transfers are often used to mask the the origin of sanctioned Iranian crude.
The vessel arrived in the waters off Alang on Jan. 25, according to cash buyers’ reports. Upon realizing a sanctioned tanker was approaching, Indian officials, including those from the central government, investigated if its documents were valid and legal, according to people familiar with the matter who asked not to be named discussing sensitive matters. The incident was first reported by Gujarat Samachar, a local newspaper. Nolan was ultimately allowed to beach on Feb. 1, the people said.
Concerns over being involved in scrapping dark fleet vessels have spooked ship operators and scrapyards before. The Pablo, a dark vessel which suffered an explosion in May 2023, waited in the waters off Malaysia for months, before being able to be sent to a scrapyard in Indonesia in 2023.
Typically, a tanker of the Nolan’s size takes hundreds of workers about seven to eight months to break down. The metal parts from the ship will be resold for use in construction and machine parts.
There’s “huge appetite” by dark fleet owners to scrap their ships as they’ve made enough money from them, especially those that have since been idled, said BRS’s Wilson. A lot of these “shadowy companies” are not in shipping for the long term, he said.
© 2025 Bloomberg L.P.
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