January 29, 2023

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Oil tankers queue off Turkey as Russian crude price cap kicks in - Financial Times

Oil tankers queue off Turkey as Russian crude price cap kicks in – Financial Times

(Reuters) – Oil tankers formed a traffic jam off the Turkish coast on the first day of a cap on Russian crude prices imposed by the West on Russian crude, the Financial Times reported on Monday, with Ankara insisting on new proof of insurance for all vessels.

The report, citing ship brokers, oil traders and satellite tracking services, said that about 19 crude oil tankers were waiting to cross Turkish waters on Monday.

The $60 per barrel price cap imposed by the Group of Seven nations, Australia and 27 European Union countries on seaborne Russian crude oil came into force this week, the latest Western measure to punish Moscow for its invasion of Ukraine.

The agreement allows the shipment of Russian oil to foreign countries using tankers from the Group of Seven countries, European Union member states, insurance companies and credit institutions only if the shipment is purchased at the ceiling or below the ceiling.

Russia said on Monday that a cap on its oil prices by the West would destabilize global energy markets but would not affect its ability to maintain what it calls its “special military operation” in Ukraine.

According to the Financial Times report, four oil industry executives said Turkey had requested new proof of full insurance coverage for any vessels navigating its strait in light of the measures.

Turkey’s Transport and Infrastructure Ministry did not immediately respond to a Reuters request for comment.

The ships had dropped anchor near the Bosphorus and Dardanelles, the two straits that connect Russia’s Black Sea ports to international markets.

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The report quoted a ship broker, who asked not to be named, as saying that the first tanker arrived on November 29 and has been waiting since then.

Additional reporting by Bharat Govind Gautam in Bengaluru; Editing by Sandra Mahler and Jean Harvey

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