06.12.22 / Embargo / Press Release

Razom We Stand calls on EU and G7 to ensure strong enforcement of oil sanctions and introduce criminal liability for anyone breaching them

December 6th, 2022 / Kyiv - Berlin

Razom We Stand is calling on European governments to eliminate loopholes and deliver strong and comprehensive enforcement of EU embargo and G7 price cap on Russian oil that entered into force on 5th December. This includes application of penalties to non-compliant ships and shipping companies as well as introduction of criminal liability for any attempts to circumvent sanctions applied to Russian fossil fuel exports.

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December 6th, 2022 / Kyiv - Berlin 

Razom We Stand, a Ukraine based grassroots organisation focused on climate and creating a full embargo of Russian fossil fuel sales, is calling on European governments to eliminate loopholes and deliver strong and comprehensive enforcement of the EU embargo and G7 price cap on Russian oil that entered into force on 5th December. This includes application of penalties to non-compliant ships and shipping companies, as well as introduction of criminal liability for any attempts to circumvent sanctions applied to Russian fossil fuel exports. Ships that transport unsanctioned Russian oil in violation of the G7 price cap should be permanently banned from entering ports and denied access to any maritime services and insurance.

On December 5, the G7 group implemented a price cap on Russian oil traded on world markets at $60 a barrel to cut Russian export revenues, and prevent Russia from profiting from its war of aggression against Ukraine. This is the first significant sanction imposed on oil or gas exports from Russia – with the potential to undercut the key revenue stream of the aggressor country.

“To make things work the involvement of any entities in trade of unsanctioned Russian oil or circumvention of related sanctions should be disincentivized by strong penalties. Breaches should be investigated and prosecuted as crimes by all governments that express good will to end Russian aggression and invasion in Ukraine. With this message we address the European Parliament, the European Council and governments of EU member states and G7”, – said Oleg Savytsky, Campaign Manager of Razom We Stand.

According to research group CREA's latest findings, in November most of the Russian oil and oil products were still shipped using tankers with European ownership or insurance, showing that Russia so far had little success in finding alternative shipping and insurance providers so far. This illustrates how strong a set of tools the international price cap coalition has, to force down Russia’s oil revenues by lowering the price cap in the coming months.

Russian oil exporters will surely seek to find tankers from third countries that could be willing to participate in circumvention of oil sanctions. Strong penalties are necessary to deter shipping companies from violation of sanctions and create incentive for compliance. It is essential to set tough penalties for vessels that don’t comply with the price cap, banning them from eligibility for insurance or entry into EU and G7 ports forever. The same should be applied to all vessels that will be identified as carriers of transhipped Russian oil. Such cases of ship-to-ship transfer of oil in open seas to obscure its Russian origin were repeatedly revealed by journalist investigations and should be covered by penalties and criminal liability for forging of fake documentation.

Prior to adoption of the price cap, on 2 December the European Commission put forward a proposal to harmonize criminal offenses and penalties for the violation of EU sanctions and restrictive measures against Russia. This proposed directive, among other things, lists as criminal offenses “trading in goods or services whose import, export, sale, purchase, transfer, transit or transport is prohibited or restricted”, which clearly applies to Russian oil in case of non-compliance with the price cap or operations of the so-called “ghost fleet”.

According to CREA estimates, Russia earned an average of €728 million per day from July 1 to the end of October from the sale of fossil fuels at market prices. Those revenues could fall by about 18%, to €595 million a day, if moderate price caps were to be in place from July 1 to deprive Russia of excess profits. A new oil sanctions tracker developed by CREA is now giving instruments to monitor how dynamics of Russia’s oil export revenues develop.

Contacts for press:

Press Contact:
Jason Kirkpatrick, Sr. Communications Mgr., Razom We Stand, [email protected]

Oleg Savytsky, Campaign Manager, Razom We Stand, [email protected]