After Russia’s invasion of Ukraine in February 2022, economic sanctions were imposed on Moscow by the European Union and others in a bid to pressure Moscow into halting the conflict.
Two years later, its oil and gas revenues have more than doubled. A “shadow fleet” used to transport Russian oil to countries such as China and India is central in achieving that and, observers claim, a main facilitator of its activities is Greece.
Estimated to number around 600 vessels, according to UK-based maritime artificial intelligence company Windward.ai, with mysterious ownership designed to obscure their transport of sanctioned Russian oil and refined products cargo since the start of the conflict, Russia has amassed a fleet of tankers, most of them old and flying foreign flags.
They pick up oil from Russian ports and then transport it to refineries around the world, transferring loads between them in the process. This blurs the origin of their cargoes and allows for the products to be sold above the sanctions-imposed price cap.
Ownership of those vessels is opaque as they often provide fake co-ordinates through their electronic systems – a practice called “spoofing” – that stops “suspicious transfers” being tracked.
Such transfers in international waters are legal, although ships known to engage in this activity are not allowed into European ports.
EU Member States are not allowed to buy oil products from Russia, while European ship owners, brokers and insurers are banned from taking part in its transportation.
Within Greece, regarded as the world’s primary shipping nation, things are less clear.
Greek ship owners, whose tankers often fly foreign flags, are believed to facilitate the transport of Russian crude oil and refined-petroleum products. Operators also allegedly profit from selling old vessels to “shady” buyers linked to Russia, which then uses them in its shadow fleet.
In the Laconian Gulf, the Southern-most gulf in Greece and the largest in the Peloponnese, scores of tankers engage in ship-to-ship transfers daily. While the international media has called attention to this practice since the start of 2023, the Greek Government has, apparently, not acted so far.
Ships registered in Greece are the third-most numerous among those engaging in oil transfers off the Greek coast – with Malta first and the Marshall Islands second, according to experts. In the shipping world, a vessel’s flag does not always reflect ownership.
The Union of Greek Shipowners stressed in a recent statement that it “faithfully complies” with sanctions on Russia. “We are doing nothing illegal”, it added.
Still, according to its chief Melina Travlos: “We can’t comment on legal business transactions.”
Politics aside, many fear the threat of an ecological disaster due to the age and poor state of the vessels involved in transportation of oil products and their ship-to-ships transfers. Local tourism and fishing industries in relative proximity to such could be gravely hit by an accident, environmental agencies have pointed out.
Ship owners in Greece traditionally wield significant leverage in domestic politics. Not only do they sponsor political parties and prominent politicians, they also own major media organisations and top-tier Greek football clubs.
For example, according to The New York Times, Capital Ship Management is owned by Greek tycoon Evangelos Marinakis, who also owns serial Greek football-league champions Olympiacos. Giannis Alafouzos, like Marinakis, has a formidable portfolio of interests. He owns the SKAI television network, as well as Katherimini, Greece’s leading newspaper.
At the root of his fortune, though, is Kyklades Maritime, a shipping company with a fleet of 22 tankers that has continued to transport Russian oil since the Ukraine war began, The NYT said.
Neither men have done anything illegal and both have publicly been fiercely critical of the Russian invasion. Many observers, though, feel they and others like them form, in a sense, an “upper caste” of “untouchables” in Greece.
Therefore, while the Greek Government is officially a staunch Ukraine supporter and even though the Laconian Gulf situation has been brought to Parliament by the Conservative Greek Solution party, things remain unchanged.
It seems to many that the Greek ‘issue” is proving key in Moscow evading sanctions and price caps – and they fear the Greek State will simply do nothing about it.