Elena Sorokina A new report by Crude Accountability, The Western Enablers Keeping the ‘Shadow’ Shipping Industry Afloat: Structural Barriers to Regulation of Maritime Commerce, sheds light on the regulatory and sanctions frameworks governing maritime commerce critical issues, revealing significant gaps that allow for corruption and sanctions evasion.
Expanding on the February 2023 report, The Maritime Shipping Industry: Opaque, Extremely Lucrative, and a Tool of Choice for Sanctioned Governments and their Facilitators, the paper investigates the key facilitators involved in sustaining this “shadow” industry: classification societies, insurance companies, and the demand for cheap oil.
The Western Enablers highlights the role of the International Maritime Organization (IMO), the industry’s primary regulatory body. It uncovers the IMO’s shortcomings in enforcing conventions, leading to inconsistent implementation by member states. These lax regulations and structural issues within the IMO fuel a rogue and toxic industry, which necessitates the international community to monitor the activities of Western insurance companies and classification societies.
The paper also examines the role of Western consumers in fueling demand for cheap oil and gas, indirectly supporting authoritarian regimes. Despite sanctions on Russian oil imports, the European Union continues to receive significant shipments of Russian LNG and crude oil, demonstrating how Western demand sustains sanctioned governments. The report also provides further scrutiny on the profiteers of this lucrative trade system, particularly Greek oil-tycoon George Prokopiou, whose businesses are deeply intertwined with the Russian oil and gas trade.
Crude Accountability calls for the IMO to address structural flaws, ensure balanced representation, and promote transparency and regulation of the maritime shipping industry to prevent its exploitation by sanctioned governments and their facilitators. We urge the international community, particularly the OSCE-partcipating states, to rein in the activities of Western insurance companies and classification societies that enable illicit practices.
Read The Western Enablers Keeping the “Shadow” Shipping Industry Afloat report HERE (PDF).