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Analysis of satellite and AIS data shows these ships still play a role in Iran’s oil sector, but experts insist the financial restrictions are nonetheless degrading Iran’s capabilities
IT IS no secret that tankers engaged in sanctions trades are masters at deceptive shipping practices, from manipulation of Automatic Identification System signals to document forgery. Those that end up under US sanctions usually double down on their manipulation of AIS, which makes tracking their activity — and the impact of sanctions — all the trickier.
What is clear though is that while sanctions raise cumbersome obstacles for tankers, they are not a kiss of death for their commercial endeavours.
Lloyd’s List tracked 11 tankers sanctioned by the US for Iran links between January and March and found the majority disappeared, manipulating their locations. Some hoisted false flags to continue trading.
Seven of the tracked tankers have emitted false location data via AIS since being designated.
Very large crude carrier Moonbay (IMO: 9230907), formerly Eternal Fortune, began manipulating its location just days after being designated on March 6.
AIS data shows the ship anchored off Vietnam from March 10 to April 18.
The vessel is moving in an impossible pattern during this period, a telltale sign of AIS manipulation. Satellite imagery verifies the transmitted location is false.
Some tankers are still falsifying their location months after they were designated, pretending to sail in circles around the same spot, such as Sincere 02(IMO: 9226011), Molecule (IMO: 9209300) and Fortune Galaxy (IMO: 9257010).
This set of tankers routinely engaged in deceptive shipping practices prior to designation by Ofac, but this activity was more targeted to hide illicit activity, such as dark ship-to-ship transfer or port calls in Iran, rather than broadly trying to disguise their whereabouts over long periods of time.
In the lead-up to being sanctioned the 11 tankers were tracked with AIS data making some 116 calls to ports and anchorages in China, Iraq, the UAE and Malaysia.
While many of these calls were not legitimate, rather part of location manipulation techniques, the post-sanction activity remains a distinct shift away from these “normal” patterns with just 10 arrivals to ports and anchorages recorded, legitimate or otherwise.
Only three tankers reviewed in this analysis have completely disabled their AIS.
Dawn II (IMO: 9185530) was trading in the Black Sea when Ofac implemented sanctions against it. The ship sailed to the area south of the Kerch Strait, a ship-to-ship transfer spot used to transport Russian commodities, and stopped transmitting AIS data on April 9.
Lady Sofia (IMO: 9212759) spent over a month loitering in different parts of the Yellow and East China Sea before disabling AIS on May 9.
Mehle (IMO: 9191711) spent some time faking its location southeast of Taiwan and then stopped transmitting AIS on April 15.
The sanctions designations have not put an end to trade.
Moonbay unloaded cargo at Dongjiakou, China, on May 27 with its AIS enabled, more than two months after it was sanctioned. Suezmax Artura (IMO: 9150365) discharged a cargo at the same terminal on July 10.
Moonbay appears to be deliberately trying to mislead anyone trying to track it using AIS. The vessel has been consistently, and for several months, transmitting data under two different MMSIs.
One MMSI, linked to Eternal Fortune and Panama flagged, erroneously shows the vessel off the coast of Vietnam.
The data linked to the second MMSI is related to Guyana-flagged Moonbay and is the legitimate source of AIS information.
Moonbay is falsely flying the flag of Guyana. More than a dozen tanker linked to Iran, including some that are sanctions, are doing so without the authorisation of the country’s maritime administration.
Aframax Reneez(IMO: 9232450) loaded a cargo at Kharg Island, a major Iranian oil export port, two months after being sanctioned.
The tanker was signalling its position near the Basrah oil terminal offshore Iraq, a common manipulation tactic.
The tankers’ behaviours following their designations illustrate how sanctions impede their ability to trade but does not take it away altogether.
“Sanctions can effectively immobilise vessels by restricting their access to ports, insurance, and international shipping services,” explained Claire Jungman, chief of staff at US lobbying group United Against Nuclear Iran, who tracks Iran’s oil flows.
“This can make it difficult for sanctioned ships to operate, thereby reducing their participation in global trade.”
“Some vessels are sitting off China for months waiting for a buyer, which is in turn taking it out of play. In other instances, we’ve seen spoofing and the use of flags of convenience to evade sanctions.”
Tanker Trackers.com co-founder Samir Madani said it was common for sanctioned tankers to be used for moving cargoes out of Iran and unto other ships through STS transfers, or as floating storage.
Helping to keep these blocked tankers in play are buyers in China, who remain willing to find ways around sanctions, although they too sometimes balk at the risk of dealing with a blocked vessel.
“Many sanctioned ships attempt to continue their journey to China, as China often remains a willing buyer despite the risk of sanctions.” said Jungman.
“This is largely due to China’s significant demand for oil. In certain cases, if no buyer is willing to risk sanctions, the vessels may return their cargo to Iran. This is often seen as a last resort due to the high costs and logistical challenges involved.”
Through July 18, the US has sanctioned 48 vessels, including 41 tankers, four liquified petroleum gas carriers, and one tug under its Iran programmes, according to Lloyd’s List Intelligence data. Crude tankers accounted for about 4.3m dwt.
But Iran is apt at recruiting new ships to its tanker fleet, numbing the impact of sanctions. About 3.85m dwt of crude tankers have joined Iran’s trading fleet since the year began (excluding five sanctioned tankers), according to UANI’s data, which is updated as of June 30.
While Iran’s exports have been robust so far this year, Jungman said preliminary figures for June, which were the second lowest this year, could indicate that sanctions were beginning to bite.
As China accounts for over 85% of Iran’s exports, the drop in June could also be due to lower Chinese demand overall, with crude imports falling below last year’s levels since February, according to Vortexa’s China oil market analyst Emma Li. However, UANI’s preliminary figures indicated exports to China rose almost 17% year on year, while falling about 18% month on month.
One of the effects of sanctions on Iran’s oil supply chains is that they lengthen the export process, for instance by requiring more STS transfers that necessitate more tonne-miles and increase costs.
A US State Department spokesperson acknowledged Iran is “making every effort to evade US sanctions” but noted that these efforts take a toll.
“Sanctions evasion is very costly — paying middlemen, laundering money and so on. We assess that the Iranian regime receives only a fraction of the revenue from its oil sales as a result,” the spokesperson told Lloyd’s List in a statement.
“We are always working to increase pressure on Iran and add to our sanctions. And we have been active in diplomacy with a wide range of allies and partners to make sure their jurisdictions are not used and abused by Iran in its effort to fund terrorism and destabilising behaviour. That work continues.”
* Lloyd’s List defines a tanker as part of the dark fleet if it is aged 15 years or over, anonymously owned and/or has a corporate structure designed to obfuscate beneficial ownership discovery, solely deployed in sanctioned oil trades, and engaged in one or more of the deceptive shipping practices outlined in US State Department guidance issued in May 2020. The figures exclude tankers tracked to government-controlled shipping entities such as Russia’s Sovcomflot, or Iran’s National Iranian Tanker Co, and those already sanctioned.
Download our explainer on the different risk profiles of the dark fleet here
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The post Iran’s tankers double down on concealment efforts post-sanctions appeared first on Energy News Beat.
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