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The Turkish straits reinsured

19 November 2022

Gromov Alexey I. Principal Director on Energy Studies, Head of the Energy Department

Alexey Gromov, Principal Director on Energy Studies of the Institute for Energy and Finance, commented to Kommersant FM on Turkey's new requirements for insurance of Russian oil cargo passing through the Turkish straits.

Turkey will oblige oil carriers to prove the availability of insurance. Potentially, this could greatly interfere with Russian exports, writes Bloomberg. The publication notes that from December 1, Ankara will demand from the vessels a letter from the insurance company confirming the conclusion of the contract. Otherwise, tankers will not be able to pass through the Bosphorus and Dardanelles.

Given the relationship between Russia and Turkey, and Ankara's past statements, it is unlikely that the country will restrict the passage of tankers with Russian oil, even if they are insured in their jurisdiction. Aleksey Gromov comments:

“In early autumn, Turkish representatives announced that they were ready to work with any insurance for Russian oil cargo. Therefore, we need to look at more detailed explanations from both the Turkish and Russian sides. Of course, Ankara's refusal to accept our insurances will lead to the risks of suspending fuel supplies through the Turkish straits. But I think that things will not come to such a development of events, given the partnership relations between Russia and Turkey at the moment.”

Gromov Alexey I. Principal Director on Energy Studies, Head of the Energy Department
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