the USA aligns its rules with the EU, to the delight of insurers…

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US aligns regulations with EU embargo

The U.S. Treasury Department “has renewed its authorization for energy-related transactions to align our regulations with the timeline for implementing the European Union crude oil ban,” a door said. -word of the ministry.

Extension of exemption

The Russia sanctions waiver was originally set to expire on June 24, but has now been extended until December 5, 2022.

This extension “will allow for an orderly transition to help our broad coalition of partners reduce their reliance on Russian energy as we work to curb the Kremlin’s revenue streams,” the spokeswoman added.

Exemptions for transactions not for imports

Imports of Russian oil into the United States, however, remain prohibited. It is thus a question of transactions, namely financial operations, most often linked to the dollar. Implied: oil majors, financial institutions and insurers will be able to continue to “handle” sumptuous sums….

Progressive EU embargo

At the end of May, as part of new sanctions taken against Moscow, following the conflict in Ukraine, the European Union decided on a gradual embargo – with exceptions – on its oil imports. Which should concern two thirds of European purchases.

The cessation of crude oil imports by sea will take place within six months and that of petroleum products within eight months. Supply via the Druzhba pipeline can, on the other hand, continue temporarily, without a deadline having been set. The pipeline notably supplies three countries without access to the sea: Hungary, Slovakia and the Czech Republic and highly dependent on Russian supplies. Tankers transporting Russian oil to third countries can no longer be financed or insured by the EU

Tankers transporting Russian oil to third countries can no longer be financed or insured within six months by European operators, in order to hinder a reorientation of exports from Moscow.

The resale of petroleum products from Russian crude is also prohibited within eight months within the EU and to third countries.

Russian gas, on which the EU is very dependent, is not currently concerned.

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American insurers, oil and financial companies therefore obtain an extension… until December 5, 2022 to carry out their transactions, which are very juicy…

Not sure that this is only to allow the European Union to organize itself…

Last April, an article in the Financial Times described the visit of Boris Johnson, the British Prime Minister, to Kyiv, to show his solidarity with Volodymyr Zelensky, the Ukrainian President, as “eye-catching and raucous stuff”.

Adding that if Johnson wanted to support Ukraine against invading Russia, he should make a symbolic visit to a closer destination: the headquarters of Lloyd’sthe largest insurance market in the world, in the City of London….

So far, the insurance industry has attracted little public attention compared to banks, with regards to Western sanctions against Russia. No wonder: most politicians (and voters) have little knowledge of the sector’s complex but crucial role in finance and trade, the media added.

If the British government, along with its European and American counterparts, demanded that insurance companies stop protecting tankers carrying Russian oil, it would be another powerful weapon in Western efforts to pressure Moscow, the FT said.

Noting that tankers carry about three-quarters of all Russian oil exports, one way for the West to reduce the flow of tankers would be to ban EU vessels from “touching” Russian crude, he added.

Another more effective tactic that would affect non-European ships would be for the British government to prevent Lloyds Marine and Aviation unions from insuring fleets that carry Russian oil; and for the UK, EU and US to ban the provision of property and indemnity insurance.

It wouldn’t stop all traffic, but most nation states wouldn’t deal with uninsured fleets, and it would be difficult for transportation groups to quickly find alternative coverage.

95% of the world’s fleet uses P&I insurance – protection and indemnity insurance, a form of mutual marine insurance provided by gatherings of professionals, called P&I Clubs and London provides 80% of wartime cover said Neil Roberts, head of navy and aviation at the Lloyds Markets Association, to UK politicians last April.

For that reason, it’s time for Western leaders like Boris Johnson to take a hard look at these weapons of insurance – even if the Lloyds and P&I contracts aren’t as telegenic as a walkabout with Zelensky in Kyiv concluded the Financial Times.

Sources: AFP, Financial Times, Maritime-executive.com

to summarize

The United States will continue to authorize transactions related to Russian energy purchases until December, when the exemption was to end at the end of June.
Stated reasons: to give European governments time to organize themselves in such a way as to reduce their imports of Russian gas and oil, while the European Union has finally agreed to decide on the establishment of a gradual embargo on crude from Russia.

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