Turkish oil tanker congestion causes delays a ban on Russian oil.

ISTANBUL (Reuters) – The number of tankers waiting to leave the Black Sea through Turkish straits increased on Friday, and Turkiye became a significant roadblock in the way of a complicated international scheme to deny Russia the proceeds from oil sales during times of conflict.

Despite days of pressure from Western authorities, Ankara has refused to reverse a new insurance inspection regulation it introduced at the beginning of the month.

According to the Tribeca shipping agency, there is a line of 28 oil tankers waiting to cross the Bosporus and Dardanelles straits.

The G7 affluent nations, the European Union, and Australia decided to forbid shipping service providers, such insurers, from assisting with the export of Russian oil unless it is sold at a very low price, or cap, intended to deny Moscow cash for use in the conflict.

According to Turkiye’s maritime administration, oil tankers without the proper insurance papers would still be barred from entering its seas.

Western insurers said that they were unable to supply Turkiye with the necessary paperwork because doing so may subject them to sanctions if it turned out that the oil shipments they had insurance on were sold for prices that were higher than the cap.

According to the Turkish government, there is a chance that an international oil spill fund would not be able to pay for the damage in the case of an accident involving a ship breaking sanctions.

It said that Turkiye was still in contact with other nations and insurance providers, saying, “(It) is out of the question for us to incur the risk that the insurance firm would not fulfil its indemnification duty.”

Ankara’s Western friends are miffed by the fact that the great bulk of ships waiting near the straits are EU ships, and much of the oil is headed for EU ports.

The Turkish government said Turkiye had planned to clear its waters of eight tankers without P&I insurance that were waiting to enter the Dardanelles in the Marmara Sea. The statement stated that when the strait is closed to marine traffic, these tankers will be escorted to traverse the Dardanelles under enhanced procedures.

Four of the tankers waiting to cross the Dardanelles, according to a maritime source, were slated to do so on Saturday with tug escorts.

Following Turkiye’s first request for insurance letters from oil tankers, one tanker flying the Turkish flag received one from an international P&I group member insurance firm, and that ship passed the Bosphorus on Friday, according to the statement.

The oil and tanker markets are becoming increasingly uneasy due to the ship backlog. Daily, millions of barrels of oil go from Russian ports to the Mediterranean via Turkey’s Bosphorus and Dardanelles straits.

OIL KAZAKH
The majority of the tankers parked in the Bosphorus are carrying oil from Kazakhstan, and Treasury Secretary Janet Yellen stated on Thursday that the U.S. government did not see any justification for subjecting such cargoes to Turkiye’s new regulations.

Washington has no reason to think that Turkiye’s decision to ban ship transits was influenced by Russia, she continued.

The European Commission stated on Friday that Turkiye could continue to validate insurance policies “in the same way as before” and that the delays were unconnected to the price restriction.

A spokeswoman told Reuters, “We are therefore in contact with the Turkish authorities to obtain answers and are seeking to unblock the situation.

Since Moscow invaded its neighbour in February, Turkiye has maintained a balance in its excellent ties with both Russia and Ukraine. It was crucial to a July agreement endorsed by the UN to allow grain shipments from Ukrainian Black Sea ports.

However, tensions have occasionally arisen between NATO allies Ankara and Washington due to Turkiye’s reiterated requests for the US to halt supporting Syrian Kurdish fighters last month.

The Biden administration imposed sanctions on Sitki Ayan, a well-known Turkish businessman, and his network of companies on Thursday after charging him with facilitating oil sales and money laundering for Iran’s Revolutionary Guards.