US considers removing sanctions on some shadow fleet vessels to cut freight rates, official says
USO•The US is considering lifting sanctions on some shadow fleet vessels to help reduce record-high freight rates. Companies would need Treasury approval to buy the vessels, and any authorization would be considered case by case.
1. Sanctions under consideration
The Trump administration is discussing allowing previously sanctioned vessels to carry “legal oil,” meaning crude or petroleum products not sanctioned by Washington, a US official said. The stated goal is to move more refined products and crude out of the Gulf.
2. Treasury review required
Companies seeking to buy the vessels would have to apply to the Treasury Department. A Treasury official said the agency may authorize transactions and remove sanctions on vessels after a thorough review, on a case-by-case basis.
3. Freight impact uncertain
Energy Aspects said easing sanctions would not greatly affect freight rates but could allow more oil movement in the Middle East. Industry sources said EU and UK rules would still bind ship insurers, while the vessels are mostly old and not well maintained.
