U.S. sanctions for violation of Russian oil price cap; advisory for maritime oil industry
Price Cap Coalition advisory recommends best practices
Price Cap Coalition advisory for maritime oil industry
The U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) today is imposing sanctions on two entities and identifying as blocked property two vessels that used Price Cap Coalition* service providers while carrying Russian crude oil above the agreed price cap.
According to today’s Treasury release, as a result of this action:
- All property and interests in property of the blocked persons that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC.
- Any entities that are owned, directly or indirectly, 50% or more by one or more blocked persons are also blocked.
- All transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of designated or blocked persons are prohibited unless authorized by a general or specific license issued by OFAC, or exempt.
OFAC also issued Russia-related General License 73 [PDF 173 KB]—Authorizing limited safety and environmental transactions involving certain persons or vessels
*The Price Cap Coalition consists of the G7, European Union, and Australia
Coalition advisory for the maritime oil industry and related sectors
In addition to today’s sanctions actions, the Price Cap Coalition published a coalition advisory for the maritime oil industry and related sectors. The advisory provides recommendations concerning specific best practices and reflects a commitment to promoting responsible practices in the industry, preventing and disrupting sanctioned trade, and enhancing compliance with the price cap.
The advisory [PDF 263 KB] (October 12, 2023) recommends the following:
- Require appropriately capitalized Protection and Indemnity (P&I) insurance
- Receive classification from an International Association of Classification Societies member society
- Best-practice use of Automatic Identification Systems (AIS)
- Monitor high-risk ship-to-ship transfers
- Request associated shipping and ancillary costs
- Undertake appropriate due diligence
- Report ships that trigger concerns
Read the Treasury release (October 12, 2023)
Lastly, the Price Cap Coalition released a statement on enforcing price caps for seaborne Russian-origin oil and petroleum products.
For more information, contact a professional with KPMG’s Trade & Customs services:
Doug Zuvich |
John L. McLoughlin |
Andy Siciliano |
Steve Brotherton |
Luis (Lou) Abad |
Irina Vaysfeld |
Amie Ahanchian |
Christopher Young |
Gisele Belotto |
George Zaharatos |
Andy Doornaert |
Jessica Libby Principal E: jlibby@kpmg.com |
| John Anderson Managing Director E: johneanderson@kpmg.com |
Jenna Leigh Glass Managing Director E: jennaleighglass@kpmg.com |
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