The US Office of Foreign Assets Control (OFAC) has added 17 Liberian-flagged bulk carriers and oil tankers to its Russian sanctions busting blacklist, citing alleged violations related to Western-imposed oil price cap sanctions on Russian oil, it was reported on January 19. The sanctions also target the shipping company Hennesea Holdings from Abu Dhabi in the United Arab Emirates (UAE).

Deputy Secretary of the Treasury Wally Adeyemo said the inclusion on the list is the consequence for those violating the price cap that was imposed almost a year ago.

"Today’s actions once again demonstrate that anyone who violates the price cap will face the consequences. No one should doubt our coalition’s commitment to stopping those who help the Kremlin," said Adeyemo.

As bne IntelliNews has reported, the oil price cap sanctions have failed after the Financial Times reported at the end of last year that not one barrel of Russian oil has been sold under the $60 cap imposed by the sanctions. The West has tried to tighten the enforcement of the oil price cap sanctions  and OFAC has already added three tankers to its list as well as putting around a hundred shipping companies on its watch list.

However, analysts say OFAC is unlikely to widely and strictly enforce the rule, as it is afraid of restricting supplies of oil to the market and causing a price spike that would have serious negative consequences for the global economy.

The blacklist also represents a change of tactics. Originally the West was hoping to use its 95% market share of maritime insurance to police the sanction. Insurance would be withheld for any ship or shipping company that did not comply with the sanctions. However, Russia and its partners have simply insured the ships themselves. At the same time, Russia has developed a large shadow fleet that operates entirely outside the sanctions regime. That has left OFAC playing a game of whack-a-mole by targeting individual ships for secondary sanctions.

The US Treasury alleges that Hennesea Holdings owns vessels involved in transporting Russian crude oil priced above the $60 per barrel limit. The vessels, purportedly owned by Hennesea, have reportedly made repeated port calls at Russian ports, according to OFAC.