- Russia has resumed crude exports to China via the Northern Sea Route (NSR) this summer, with all shipments carried on sanctioned tankers—most lacking full insurance coverage.
- August’s Arctic crude shipments to China have surged to their highest in nearly a year, while exports to India have fallen under geopolitical pressure.
- Environmental groups warn of heightened risks to the fragile Arctic ecosystem from ageing, sub-standard vessels.
Russia has begun moving crude through its Arctic shipping corridor during the 2025 navigation season, ship-tracking data from S&P Global Commodities at Sea shows. The LR1 Kirill Lavrov departed Varandey on July 15 with 475,000 barrels of Novy Port crude and is set to discharge in Dongying, China, on August 13. Two additional vessels—the Aframax Nevskiy Prospect with 745,000 barrels and the Suezmax Latur with 968,000 barrels—are also en route to China via the NSR.
Economic and Strategic Appeal of the NSR
The NSR offers a voyage from Russia’s Arctic oil hubs to Shandong that can be 40% faster than the Suez Canal route, cutting transit time from six weeks to less than four. This seasonal shortcut, navigable from July to November, reduces freight costs and supports Russian efforts to expand trade with China. In 2024, Russia sent 7.86 million barrels through the route, compared with 9.49 million barrels in 2023.
Export Shifts Between China and India
Preliminary August figures show Russian Arctic crude shipments to China averaging 143,000 barrels per day—more than triple July’s 47,000 b/d and the highest in 11 months. Meanwhile, exports to India have dropped to 87,000 b/d from 188,000 b/d, reflecting growing US and EU pressure on New Delhi to scale back purchases.
Sanctions, Insurance Gaps, and Regulatory Concerns
All three tankers making NSR voyages this season are 15–22 years old and sanctioned by Western authorities. Sanctioned vessels often lack adequate insurance, maintenance, and compliance with international safety standards. The Nevskiy Prospect holds coverage from sanctioned Russian insurer SOGAZ, while the other two have no confirmed insurance. Notably, the Kirill Lavrov is the only ship on the NSR Administration’s official permission list, despite all three operating in Russian Arctic territorial waters where prior approval is required.
Environmental Warnings
The Clean Arctic Alliance has voiced strong concerns about the risks posed by inadequately maintained and insured ships in Arctic waters. The group warns that non-compliance with International Maritime Organization standards increases the likelihood of incidents that could severely impact the region’s fragile ecosystem.
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Source: S&P Global
