The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has imposed sanctions on four entities and identified one tanker as blocked property for violating the price cap on Russian oil. This marks the second price cap enforcement action taken by the OFAC in 2024 as the U.S. is continuing its crack down on price cap violations.
The entities involved in the scheme, along with tanker NS Leader, are alleged to have participated in violating the price cap on Russian oil. The price cap was introduced in December 2022, in a joint agreement between the United States, the G7, the European Union, and Australia. The cap, set at $60 per barrel, was designed to maintain a consistent global oil supply while reducing Russia’s oil revenues which are suspected to be used in funding its war in Ukraine.
However, in November 2023, Zeenit Supply and Trading DMCC, a UAE-based entity, sold Russian Urals crude oil at over $80 per barrel, delivered using the vessel NS Leader. This vessel utilized services provided by a covered U.S. person during the voyage.
According to OFAC, Zeenit and another UAE-based entity, Talassa Shipping DMCC, have been involved in shipping multiple cargoes of crude oil of Russian origin using vessels that loaded in Russian ports in 2023. Both entities share a business manager and were founded roughly a week apart in July 2022.
The NS Leader, registered under NS Leader Shipping Incorporated, is owned by the Government of the Russian Federation. It made five port calls in Russian ports in 2023. Oil Tankers SCF Mgmt FZCO, another UAE-based entity, managed the NS Leader since September 2023, including during the November voyage when the vessel carried above-cap crude oil of Russian origin.
As a result of these findings, Zeenit, Talassa, NS Leader Shipping, and Oil Tankers SCF have been sanctioned under Executive Order 14024 for operating in the marine sector of the Russian Federation economy. The United Kingdom has also sanctioned Oil Tankers SCF.
Last month, OFAC imposed new sanctions on a UAE-based shipping company, Hennesea Holdings Limited, along with eighteen of its vessels for transporting Russian crude oil above the $60 per barrel price cap.
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