The Mikati, a 58,000-ton oil tanker, faced a significant challenge when it was sanctioned by the European Union, adding it to Russia's shadow fleet. This incident highlights the complexities of the EU's sanctions regime, which now encompasses over 600 ships. The Mikati's journey through the English Channel and subsequent actions reveal both the strengths and weaknesses of these sanctions.
Suspicious Behavior and Sanctions:
The Mikati's story began with suspicious behavior, including name changes, anonymous ownership, and the intentional deactivation of its AIS location transponders, which is considered a dangerous shipping practice by the International Maritime Organization (IMO). These actions, along with a flag change to Sierra Leone, were enough evidence for the EU to blacklist the vessel. The Mikati was included in the EU's 18th sanctions package against Russia on July 18, immediately impacting its operations.
Impact and Delays:
After being sanctioned, the Mikati arrived in Kochi, India, but did not unload its full cargo, which it had picked up in Russia's Barents Sea port of Murmansk a month earlier. The ship paused off the coast of India on July 29, and its 11-day delay was likely due to sanctions and the need for new insurance, as explained by Windward analyst Michelle Bockmann. This delay is a prime example of how EU sanctions can disrupt operations.
EU vs. US Sanctions:
The effectiveness of sanctions varies between the EU and the US. While the EU's sanctions have had some impact, with a 30% average decline in productivity for sanctioned ships, the US Treasury's Office of Foreign Assets Control (OFAC) sanctions have been deemed more effective, causing a 70% average decline. This disparity suggests that the US has a more robust system for enforcing sanctions.
Loitering and Productivity:
Sanctioned vessels often exhibit uneconomic behavior, such as loitering around ports. The Mikati remained in the port area for an extended period after unloading in Mangalore, China, and later in Port Said, Egypt, where it engaged in a ship-to-ship transfer with another sanctioned tanker. This behavior is typical of sanctioned vessels, which have limited options and face challenges in finding new cargo.
Destination and Future Moves:
The Mikati's destination after its ship-to-ship transfer in Egypt was likely India or China, or even another ship-to-ship transfer. The vessel's transponders were turned off near Russia's main Baltic crude export port, Uts-Luga, on December 10-12, indicating potential future moves. The Mikati's journey showcases the ongoing challenges and complexities faced by sanctioned vessels in the global shipping industry.
