Russian oil tankers facing UK insurance ban

Exports of oil from Russia are set to be further curtailed under UK plans to join with the EU in a ban on insuring Russian ships.

The ban will shut Russia out of the crucial Lloyd’s of London insurance market, which is expected to significantly restrict Moscow’s ability to sell oil around the world.

Ursula von der Leyen, president of the European Commission, said this week that EU leaders had agreed “a ban on insurance and reinsurance of Russian ships by EU companies” as part of its latest package of sanctions on Moscow, which includes phasing in an embargo on 90 per cent of EU imports.

The UK will introduce the same sanctions as part of a co-ordinated ban, under plans first reported by the Financial Times, which said that the UK’s action had been critical in securing the EU agreement. Details of the ban are expected to be announced imminently.

Lloyd’s is the world’s oldest and most important insurance marketplace, established more than 330 years ago.

A spokesman for the insurer said: “Lloyd’s supports and remains focused on the delivery of a global sanctions regime against the Russian state, which sends an important message that its invasion of a peaceful country is unacceptable. We are working closely with UK and international regulators and governments to implement the sanctions. Our sympathy and our support are with the Ukrainian people and those directly affected by the war.”

Britain has already said it phase out imports of Russian oil and fuel by the end of this year. The EU has now also agreed to end seaborne crude imports and most pipeline imports by the end of this year, with exceptions only for landlocked Hungary, Slovakia and the Czech Republic.

RBC Capital Markets analysts had earlier flagged that an insurance ban — mooted by the EU over past weeks — would be the critical factor in determining whether the barrels previously destined for Europe would be able to find new homes in countries such as India.

Lloyd’s List, the shipping specialist publication, reported that underwriters were seeking clarity of the details of the ban and in particular how Russian vessels would be defined: whether by Russian flag, class, ownership, or chartering. Such details would make a huge difference to the impact of the ban, it said.

Sanctions have already been imposed on Sovcomflot, Russia’s leading shipping company.

The Foreign Office was not commenting at the time of publication.