Price Cap Coalition publishes updated advisory for maritime industry stakeholders

On October 21, 2024, the Price Cap Coalition, comprised of G7 countries as well as the European Union, Australia, and New Zealand, issued an updated advisory that provides industry stakeholders involved in the maritime shipment of crude oil and refined petroleum products with new recommendations aimed at disrupting sanctioned trade and enhancing price cap compliance.  The new advisory updates recommendations originally issued by the Coalition on October 12, 2023.  The update specifically addresses the increased risks posed by the “shadow” trade that have recently become more pronounced in the maritime oil industry, including heightened threats posed by use of older ships in “shadow fleets” and their possible reliance upon inadequate protection and indemnity (“P&I”) insurance providers that lack the capital and/or technical expertise to handle a major marine casualty event.

The advisory encourages both government and private sector actors in the industry to adopt the following practices, as appropriate, according to their risk:

1. 1. Require the use of vessels that have appropriately capitalized P&I insurance
   2. Require the use of vessels that have received classification from an International Association of Classification Societies (“IACS”) member society
   3. Promote the continuous use of Automatic Identification Systems (“AIS”)
   4. Monitor high-risk ship-to-ship transfers
   5. Request associated shipping and ancillary costs
   6. Carry out appropriate due diligence on shipping companies and intermediary companies
   7. Report ships that trigger concerns to the appropriate authority
   8. Ensure that vessels meet international maritime safety and environmental obligations
   9. Monitor the sale of tankers, especially aging tankers
   10. Avoid interactions with sanctioned parties
   11. Conduct trainings to enhance awareness and market transparency.

The United States also announced that it endorsed the United Kingdom-led “Call to Action” released in July 2024.  The publication discusses the risks posed by Russia’s shadow fleet and invites international partners to develop a coordinated response to those risks.

U.S. Department of Treasury Press Release | Updated Price Cap Coalition Advisory | Call To Action