Barstad Advocates for Sanctions Flexibility in "Shadow Fleet" Decommissioning

tankers in the “shadow fleet” that cater to countries like Russia, Iran, and Venezuela are generally much older than those in the mainstream market. Many of these vessels are past their prime and should ideally be retired. Though, due to sanctions imposed by the U.S. and Europe, it’s challenging for buyers interested in scrapping these ships to acquire them for demolition.As they age further without a clear exit strategy, they pose notable environmental and safety hazards—a concern highlighted by Lars Barstad, CEO of Frontline.

“We really need some guidelines that allow for recycling exemptions specifically for these shadow fleet tankers,” Barstad mentioned during a recent earnings call. “The alarming scenario is that we could see these ships just drifting around southeast Asia—essentially floating time bombs.”

This isn’t just speculation; there have been real incidents already. As an example, earlier this year, the tanker Pablo, which was under U.S. sanctions for transporting Iranian oil, suffered an explosion while anchored in Malaysia—resulting in three crew members going missing after its main deck was blown off.In another incident involving a suspected shadow fleet vessel named Ceres I, there was a serious collision followed by an explosion off Malaysia’s coast last year. Additionally, many vessels linked to Russia operate without proper insurance coverage against spills—a troubling reality given that hundreds of tankers within this shadow fleet are blacklisted by authorities like OFAC or the EU.

If regulations allowed these aging vessels to be exempt from sanctions so they could be sold off as scrap—similar to compliant tankers—it would not only benefit their elusive owners financially but also help eliminate hazardous ships from our waters. This would enable those owners to refresh their fleets with newer secondhand options while together addressing safety concerns associated with old tonnage.

“I hope regulators prioritize this issue over others like decarbonization,” Barstad added thoughtfully. “It’s unfortunate how long such processes can take before they become urgent.”