2 shipping companies face first sanctions over Russian oil shipments

The Department of the Treasury announced sanctions against two shipping companies Thursday, one based in Turkey and the other in the United Arab Emirates, over allegations they violated international price caps on Russian oil.

In an announcement, the department’s Office of Foreign Assets Control (OFAC) said that a ship owned by Turkish company Ice Pearl Navigation sold Russian oil at $80 a barrel, above the $60 limit imposed by the U.S., the European Union, Australia and the Group of 7.

The second company, UAE-based Lumber Marine SA, priced Russian oil at $75, according to the OFAC. The sanctions will bar the companies, both of which used U.S. service providers in violating the price cap, from conducting business in the U.S. or accessing their properties or assets in the country.

The price cap was imposed in 2022 in retaliation for the Russian invasion of Ukraine, with a goal of reducing Russian energy profits while maintaining reliable supplies to international markets. Treasury officials claim the cap has cost Russia’s oil industry 45 percent in tax revenue since its imposition. Under the cap, western countries are also banned from providing maritime and financial services for Russian exports above the cap.

“Today’s action demonstrates our continued commitment to reduce Russia’s resources for its war against Ukraine and to enforce the price cap,” Deputy Secretary of the Treasury Wally Adeyemo said in a statement.

“We remain committed to implementing a price cap policy that has two goals: reducing the oil profits upon which Russia relies to wage its unjust war against Ukraine and keeping global energy markets stable and well-supplied despite turbulence caused by Russia’s unprovoked invasion of Ukraine. We will continue to take actions to achieve these two goals.”  

Yasa Holding, which operates the Turkish vessel, the Golden Bosphorus, has said the ship is under a charter to ExxonMobil for between three months and five months.

“ExxonMobil complies with all applicable laws and does not trade Russian oil or products. These deliveries are certified products of Canadian origin,” an ExxonMobil spokesperson told The Hill.

–Updated on Oct. 13 at 11:29 a.m.