- Nearly 19% of global tanker capacity is tied to clandestine operations moving Russian, Iranian, and Venezuelan oil.
- Shadow fleets—old, uninsured, and often operating covertly—enable sanctioned producers to maintain revenues while reducing export discounts.
- China remains the key buyer, while Western regulators tighten enforcement through price caps and sanctions on ship operators.
Russia, Iran, and Venezuela, facing tightening Western sanctions, have leaned on shadowy shipping operators to keep crude and product exports flowing. Together, these clandestine fleets now account for 978 tankers with 127 million dwt, nearly 19% of the world’s oil tanker capacity, according to S&P Global and Maritime Intelligence Risk Suite.
The growth is striking: in November 2024, the shadow fleet stood at 889 ships with 112 million dwt. Many of these vessels handle barrels from multiple sanctioned producers, highlighting the flexibility of operators driven by profit rather than regulation.
Most of these ships are old, uninsured, and often disable tracking transponders during offshore transfers, sparking safety and compliance concerns. Yet buyers, particularly China, remain willing to absorb these flows.
Trade Flows by Country
Russia
Seaborne crude and product exports in 2025 have averaged 5.7 million b/d, little changed from pre-sanctions levels.
Between 60–80% of Russian crude exports are carried on shadow-linked ships.
A dedicated fleet shipped 3.3 million b/d in H1 2025 (2.5 million b/d crude plus refined products).
Exports rose to 3.4 million b/d in August, even as new sanctions were applied.
India’s intake fell to 1.3 million b/d, while China’s rose to 1.1 million b/d.
Iran
Production averaged 3.24 million b/d in July, dipping slightly to 3.18 million b/d in August.
Seaborne exports of crude and condensate hit 1.6 million b/d in 2024–25, up sharply from 434,000 b/d in 2020.
Most barrels are moved via shadow fleet tankers, often using transshipments in Southeast Asia.
China remains the dominant buyer.
Venezuela
Output has held above 900,000 b/d in 2025, the highest this decade but well below historic peaks.
Exports have averaged 711,000 b/d, the strongest in six years but still far below 2018 levels.
Cargoes primarily go to China, with some volumes reaching the US under waivers for Chevron.
Fleet Infrastructure
Russia: 561 ships, 49.9m dwt, including 228 Aframax/LR1 and 58 Suezmax tankers. Sovcomflot manages much of the sanctioned fleet.
Iran: 170 ships, 34.2m dwt, with 86 VLCCs active across the Gulf, Southeast Asia, and beyond. Many are run by opaque firms tied to Tehran.
Venezuela: 54 ships, 9.5m dwt, largely under PDVSA or shadow-linked operators.
Flexible Pool: 193 multi-use tankers (33m dwt) deployed across sanctioned trades, often for offshore transfers off Malaysia.
Impact of Price Caps
The G7, EU, and allies have set thresholds:
$60/b for crude
$45/b for discounted products
$100/b for premium refined products
In September, the EU, UK, and Canada lowered the Russian crude cap to $47.60/b, while the US kept it at $60/b.
Despite efforts, Russia’s expanded shadow fleet has narrowed crude discounts. The Urals discount to Brent averaged just $11.64/b in August FOB Primorsk, the smallest since early 2022. On delivery to India, discounts narrowed to $2.41/b, compared with over $17/b in February 2023.
The persistence of these shadow fleets highlights the resilience of sanctioned oil exporters. As Western regulators close loopholes and lower price caps, Russia, Iran, and Venezuela are increasingly dependent on opaque operators willing to assume higher risks. This strategy reduces discounts and keeps oil revenues flowing but leaves global shipping exposed to greater safety, compliance, and enforcement challenges.
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Source: S&P Global
