Despite Putin’s atrocities in Ukraine, insurers enable the export of 40 million barrels of Russian oil

Between 24 February and 21 March 2022, more than 360 ships discharged a staggering quantity of fossil fuels loaded from Russian ports. According to statistics accessed via the financial data provider Refinitiv on March 22 2022, these vessels carried:

• 39.3 million barrels of crude oil;      
• 7.52 million barrels of fuel oil;
• 473,000 tonnes of liquefied natural gas; and
• 2.82 million tonnes of coal.

The sale of these fossil fuels has helped fund Russia’s brutal war on Ukraine, which has killed thousands and created millions of refugees. Refinitiv data shows that every one of these vessels were insured by one or more of the 13 "protection and indemnity” insurance associations that form the International Group of P&I Clubs (IGP&I). (Only one of these 13 clubs, the Shipowners' Mutual Protection & Indemnity Association (Luxembourg), did not appear in Global Witness’s analysis of these shipments.)

These 13 P&I clubs provide liability cover for 90% of the world’s seaborne cargo - cover that was apparently extended to the ships carrying this conflict fuel. The insurance provided by these clubs is required by EU law and international conventions, and makes it possible for such fossil fuel cargoes to be transported by sea.

Protection and indemnity clubs are mutual insurance associations that are owned by their members, including the shipowners and managers themselves. They are not answerable to shareholders, and write their own rulebooks.

While some of these clubs have reminded their members to comply with sanctions and alerted them to local shipping conditions near Ukraine, none have excluded Russian fossil fuels from coverage. IGP&I itself has also remained publicly silent on the group’s clubs providing cover to chartering and shipping these conflict fuels. But it has responded to criticism from Oleg Ustenko, economic advisor to Ukrainian president Volodymyr Zelenskyy, in a letter seen by Global Witness.

“If the 13 International Group Clubs did collectively withdraw or terminate their insurance cover arrangements with shipowners who carry Russian fossil fuels, the impact would likely have some immediate effect on the volume of such fuels carried by sea”, the IGP&I wrote. However, the group asserted, this would likely only result in a “limited short-term hiatus” as a “determined tanker owner” set on transporting Russian fossil fuels could arrange alternate insurance from a different organization.

Bombs are currently falling on Ukraine. There is no excuse for continuing to underwrite an industry that fuels the destruction of an entire country as well as our shared climate.

Global Witness asked all 13 international clubs whether they will now exclude shipowners carrying Russian fossil fuels from coverage. Only Gard responded. Its spokesperson said: “Withdrawing [protection and indemnity] protections may reduce shipments of certain cargoes in the immediate short term but it may also have the unintended consequence of exposing innocent third parties to risks for which they would otherwise be compensated if insurance cover were allowed to continue. It is our role as insurer in these difficult and turbulent times to effectively protect people, property and the environment while ensuring that all relevant regulations and sanctions are followed.”

The enablers of Russia’s trade in oil, gas, and coal are propping up a regime that murders innocent civilians even as it drives the climate crisis. These companies now have a choice. Exclude Russian fossil fuels from their business or remain complicit in Putin’s war crimes against the Ukrainian people.

Sanctions of Russian entities and people are evolving rapidly. Global Witness makes no suggestion that IGP&I, its clubs, or any insured member has violated sanctions.