Global Economy — 2026-05-12

Russia Circumvents Oil Sanctions Via Ship-to-Ship Transfers and Dark Fleet Expansion

Russia has substituted European export markets with Asian ones, the National Interest reported, with India now receiving 36 percent of its oil demand from Russian sources up from 2 percent in 2022, and China absorbing roughly a fifth of its crude imports from Moscow. India and China together take 80 percent of Russia's crude exports at some 3.5 million barrels per day at peak delivery, according to the Kyiv School of Economics. CREA data show Russian crude has traded above the G7-imposed $60 price cap since December 2022, with Moscow earning an estimated $9 billion above what the cap permitted. Dubai-registered intermediaries including Forteza Trading DMCC, Patera Middle East DMCC, and Lidoil DMCC facilitate repackaging of Russian oil behind UAE commercial secrecy laws, with new firms replacing sanctioned ones within weeks: Alghaf Marine DMCC assumed the commercial operations of Litasco Middle East DMCC after the UK sanctioned the latter in July 2025. An Atlantic Council assessment published alongside the analysis found the shadow fleet reached an estimated 1,140 tankers by August 2025, more than 18 percent of the global oil tanker fleet, and that Russian military vessels began escorting shadow ships through the English Channel and Baltic Sea in January 2026.

Analysis
Russia's oil sanctions architecture is failing structurally: Dubai intermediaries regenerate faster than designation lists can absorb them, and ESPO crude has traded above the $60 cap since December 2022, generating roughly $9 billion in excess revenue per CREA data. Moscow's January 2026 authorization of naval escorts through the Baltic and English Channel converts circumvention into state-protected commerce, raising the interdiction cost for coastal states. The EU's April 2026 action against Kyrgyzstan signals a doctrinal shift toward sanctioning jurisdictions rather than shells, but Dubai secrecy and dollar-settlement architecture remain intact. Shadow fleet maintenance and repackaging costs likely compress Moscow's realized gains. Western enforcement agencies will likely designate at least ten additional dark fleet vessels by end of November 2026.

2 sources

How Russia Circumvents Oil Sanctions and What Washington Can Do to Stop It - National Interest
April 2026 — Monthly analysis of Russian fossil fuel exports and sanctions - Centre for Research on Energy and Clean Air (CREA)