A leading Russian insurer of oil tankers against risks such as collisions and spills said it will not fill a gap left by sanctions on the country’s petroleum exports.
The Group of Seven’s sanctions, which began December 5, ban companies from offering insurance on Russian oil if the cargo is purchased at a price higher than $60 a barrel.
With the vast majority of covers arranged through companies in G-7 countries, how will tankers transporting the country’s oil be insured when international companies do not? Ingosstrakh Insurance Co., a so-called Protection and Indemnity (P&I) underwriter, said it would not ramp up.
“Ingosstrakh has no plans to expand its P&I portfolio by offering P&I policies to new customers who may lose coverage from international P&I clubs after new restrictions came into effect on December 5,” the company said in a Explanation.
The comments are more direct than comments Ingosstrakh previously made about whether it would fill a void left by western insurers.
Russia previously said it could work with buyer states to insure the ships. It is unclear whether this approach has already been attempted.
Ingosstrakh previously said its total P&I portfolio, including domestic river fleet coverage, bunker and cabotage vessels, represents less than 1% of all money it receives to underwrite risks – known as its total premiums written.
The firm also said it would not offer ad hoc insurance for a backlog of tankers building up in the Turkish Straits, as Ankara sought assurances they were insured for transit on major waterways.
“We are not ready and will not provide short-term P&I coverage for vessels impacted by Turkey’s new Bosphorus estuary regulations,” the Russian company said in a statement.
The impasse appeared to have been resolved by December 12. Several tankers have passed through the strait since the weekend, suggesting Turkey is now content the ships are covered.
