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Tanker Liteyny Prospect, Hit by Sanctions, Docks in China to Offload Russian Oil

Reuters
Total Views: 941
March 7, 2024
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SINGAPORE/MOSCOW, March 7 (Reuters) – The Russian tanker Liteyny Prospect, hit by sanctions, has docked at the Chinese port of Huanghua to discharge its 700,000-barrel Russian Sokol crude cargo, two sources familiar with the matter said, clearing part of a backlog of cargoes disrupted by sanctions on Moscow’s oil trade.

The tanker is one of six ships carrying Sokol crude, which India has not been able to import due to payment issues. The six ships had been sailing to China but five of them are floating at sea early this week, shipping data showed, following fresh U.S. sanctions on the Russian oil fleet.

The Liberian-flagged Liteyny Prospect docked on Wednesday at a berth at Huanghua, near Cangzhou city in Hebei province, that handles mostly coal and iron ore shipments, shipping data from analytics firms LSEG, Kpler and Vortexa showed.

Cangzhou port officials and the manager of the tanker, Sovcomflot (SCF), did not immediately respond to requests for comment.

It is unclear what is holding back the remaining five ships from discharging their cargoes.

Although there is no clear regulation or guidance for ports to decide whether to allow vessels under sanctions to dock, port authorities are wary of secondary sanctions, trade sources said.

The ports are likely to have told buyers that there is no issue with customs clearance but would not allow oil to be stored for extended periods of time, the sources added.

The backlog of Sokol tankers is the biggest disruption to Russia’s oil trade since the West imposed sanctions on Moscow over its military actions in Ukraine. Sokol oil is a low-sulfur grade exported from De Kastri terminal of Russia’s Sakhalin island by Sakhalin-1 LLC, controlled by oil giant Rosneft.

Rosneft did not immediately respond to a request for comment.

The U.S. Treasury’s Office of Foreign Asset Control (OFAC)late last month imposed sanctions on SCF and designated 14 crude vessels, including Liteyny Prospect, as property in which SCF has an interest.

OFAC issued general licenses allowing the offloading of crude oil, or other cargoes, from the 14 vessels for 45 days, and allowing transactions with all other Sovcomflot tankers.

The sanctions are aimed at reducing Russia’s revenues from oil sales it can use to support its war in Ukraine.

(Reporting by Chen Aizhu and Florence Tan in Singapore and Reuters reporters in Moscow; Editing by Tony Munroe, Christian Schmollinger and David Evans)

(c) Copyright Thomson Reuters 2024.

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