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The U.S. has imposed new sanctions on a UAE-based shipping company operating eighteen vessels for transporting Russian crude oil above the $60 per barrel price cap.
The sanctions come as the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) is continuing to crack down on a shipping companies associated with price cap violations. Today’s actions mark OFAC’s first oil price cap enforcement action of 2024.
“Today’s actions once again demonstrate that anyone who violates the price cap will face the consequences,” said Deputy Secretary of the Treasury Wally Adeyemo. “No one should doubt our coalition’s commitment to stopping those who help the Kremlin.”
The US, along with an international coalition comprising the G7, the European Union, and Australia (known as the Price Cap Coalition) has pledged to prevent the import of Russian-origin crude oil and petroleum products by imposing a price cap designed to ensure a steady supply of crude oil and petroleum products to the global market while curbing the revenue that Russia earns from oil to fund its war against Ukraine. The coalition has also agreed to limit a wide array of services linked to the maritime transportation of Russian oil sold above the price cap.
The price cap has led to the emergence of a “shadow fleet” of tankers that are used to transport Russian oil over the price cap and under the radar.
According to OFAC, Hennesea Holdings Limited, a UAE-based shipping company, owns 18 vessels, including the HS Atlantica, which was involved in transporting Russian crude oil priced above the $60 per barrel cap while using a covered U.S.-based provider after the price cap policy came into effect. Hennesea, established in late 2022 before the price cap came into effect, has acquired older tankers for shipping Russian crude oil and petroleum products, and its tankers have frequently visited Russian ports, the Treasury Department alleges.
Hennesea was designated under E.O. 14024 for operating in the Russian Federation’s marine sector.
OFAC identified the following vessels, all of which are beneficially owned by Hennesea, as property in which Hennesea has an interest:
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