US considers easing sanctions on shadow fleet vessels to cut freight rates, official says
The Trump administration is considering easing sanctions on so-called shadow fleet vessels that have transported oil and petroleum products from countries including Russia, Iran and Venezuela, in an effort to reduce record-high global freight rates, a US official said on Wednesday.The discussions are happening days after President Donald Trump temporarily lifted sanctions on Russian diesel fuel, a move met with a torrent of criticism from Ukrainian President Volodymyr Zelensky, European countries and some of Trump’s fellow Republicans in the US Senate.Both Zelensky and the US senators called that move a gift to Russian President Vladimir Putin that would provide Russia with revenue to keep funding its war in Ukraine.The new talks center on the United States potentially allowing “legal oil” to flow on previously sanctioned vessels, the US official said.That means crude or petroleum products not sanctioned by Washington rather than Russian and Iranian oil, which are under punitive measures.The goal is to get more refined products and crude out of the Gulf, the official said.US Energy Secretary Chris Wright said in a video to the World Petroleum Congress in Riyadh this week that the administration was talking about easing the sanctions on shadow fleet vessels in an effort to cut record freight rates that have cut into demand for US crude, according to Energy Aspects, a research group.Bits of the talk were broadcast on social media, but Reuters was not able to obtain the full video or a transcript.
The Department of Energy said it was not available.Companies seeking to use the sanctioned vessels would have to apply to the US Treasury Department to use the vessels, the official said.The Department of Energy said any move to relieve sanctions on the shadow fleet would not help Russia to move oil or oil products.The Treasury Department referred questions to the Department of Energy.
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