Since Russia’s invasion of Ukraine in 2022, Russia has joined Iran and other pariah nations in using “ghost ships” to transport oil and other goods and bypass international sanctions. Russia’s ghost fleet primarily consists of older vessels that have a higher risk of breaking down and being involved in accidents. Beyond the inherent risks of using older, run-down vessels, ghost ships also engage in risky behavior by turning off their Automatic Identification Systems (“AIS”) and spoofing their locations to conceal illegal activities. For months, maritime experts have been warning of these vessels’ potential to cause harm. Such accidents involving Russian and Iranian ghost ships are already occurring at a higher frequency than many realize. Smaller accidents often go unnoticed and unpunished. With around two thirds of Russian tankers being insured by unknown companies, accountability is difficult. As Russia has shifted its oil sales to be covered by the ghost fleet, which by some estimates consists of up to 650 vessels, more incidents can be expected. To tackle this challenge, the U.S. and its allies must either step up enforcement of current laws on third-party companies enabling ghost shipping or update existing sanctions to address the current realities of Russian shipping.
What is a “Ghost Ship”?
Ghost ship incidents are not making headlines, despite many predictions of the risks involved, because these ships are inherently difficult to identify and track. The U.S. and its allies sanctioned Russian shipping lines such as FESCO and Sovcomflot, but many subsidiary companies have sprung up in their place. Take for example Sun Ship Management Ltd. of Dubai. The company took over management of over 90 tankers that previously belonged to Sovcomflot, after sanctions were imposed. Despite denying its connection to Russia, Sun Ship was later sanctioned as a subsidiary of Sovcomflot.
However, sanctioning companies like Sun Ship is like playing whack-a-mole. When companies are exposed for their links to Russia, more subsidiaries spring up in their place. For example, an India-based company, Gatik Ship Management, emerged seemingly out of nowhere as a major shipper of Russian crude after war broke out in Ukraine. After attracting international scrutiny, it sold off its ships to a milieu of previously unheard of companies tangentially linked to Gatik. Since 2022, a shocking 864 maritime companies linked to Russia have been created.
The complicated web of ownership and the lack of a clear definition for what qualifies as a ghost ship has meant that, even when these ships are involved in accidents, the media often does not notice. There is no agreed upon definition for ghost ships, and their constant adaptation to sanctions makes them harder to identify. For example, though ghost ships are typically old vessels, some fleets have been taking in middle-aged vessels to avoid detection. Linking ships involved in accidents to ghost fleets is also inherently difficult as ships change flags often and are owned by shell companies, as was the case with Gatik’s fleet. Additionally, much of the conversation focuses on the actions of Russian and Iranian tankers, but their clandestine cargo shipping has also broken sanctions and led to accidents.
The American Enterprise Institute (“AEI”), a think tank in Washington D.C., cross-referenced reported incidents from KPLER’s FleetMon with ownership data from Equasis and Russian ship registries. AEI has identified over 40 incidents in 2023 that have a high likelihood of ghost ships being involved. These incidents range from engine failures and fires, to explosions and collisions. The ships involved in these incidents are owned by companies either directly linked to Iran and Russia or that are operating as subsidiaries, much like Gatik and Sun Ship. Only a handful of these incidents were highlighted in other comprehensive reports of ghost ship incidents.
Consequences of Ghost Shipping Incidents
Beyond their role in supporting Russia’s war machine, ghost ships are harming the environment and endangering crews. Take the example of one ghost ship, Pablo, which exploded off the coast of Indonesia in summer of 2023. Built in 1997, the ship was set to be sold as scrap five years ago before, instead, joining Iran’s shadow fleet. On May 1, 2023, the ship erupted in flames, killing three crewmembers and seriously injuring four others. Following the wreck, oil washed up on the shores of Indonesia, and Indonesia experienced massive air pollution. Without a known insurer, Malaysian authorities were forced to deal with the incident. Had it been carrying its full capacity of 700,000 barrels of oil at the time of the accident, billions of dollars of environmental and economic damage could have occurred in the Malacca Strait, a high traffic shipping area home to extensive fisheries and productive coastal ecosystems.
However, in many incidents, ghost ships mitigated the potential impact of the accidents. For example, the two ghost ships Mercury and Agnes,managed by Gatik Ship Management at the time of the incident, lost control of their vessels and were dragging their anchors in the Bay of Gibraltar. They were rescued by nearby tugs and prevented from causing harm to docked ships. The incident garnered little media attention, despite the ships’ clear link to the ghost shipping network.
Although the conversation around ghost ships is typically centered on tankers, cargo vessels linked to Russia have also been involved in a number of serious incidents. For instance, Russian-flagged cargo ferry Slavyanin collided with another ship in the Black Sea this month. In February 2023, Fesco Tatarstan, a 15 year-old Russian-flagged cargo ship, leaked methane and required a specialized crew to come clean up. Sergey Bodrov, a cargo ship belonging to Turkey’s Clan Ship Management, a company linked to Russian trade, nearly collided with Norwegian oil fields last month, after its engine failed. Regional coast guards stepped in to prevent catastrophe.
Despite improvements in safety for shipping over the past decade, the risk of incidents from ghost ships has increased. To further improve safety in the maritime community, countries must address the various problems of ghost ships. Countries are beginning to crack down on ghost shipping by denying ghost ships entry to their ports or detaining them. EU sanctions outline that ships who turn off their AIS trackers while transporting Russian oil will be denied entry to their ports. Coast guards can play a role by seizing ships involved in illegal oil transfers, as the Indonesian coast guard did with Iranian tankers in July 2023. Stricter enforcement of such rules and the adoption of ghost ship related sanctions by more nations will improve maritime security.
Additionally, as more ships are exposed for being part of ghost fleets, they have lost their insurance coverage and are removed from registries. One avenue to adapt sanctions to meet the current problem would be to require vessels transiting various choke points such as the Gulf of Finland to show proof of insurance. Ghost ships, which are by nature difficult to insure, would be forced to take longer routes or upgrade their safety standards.
Ghost ships threaten maritime safety, harm the environment, blatantly subvert U.S. and E.U. sanctions, and allow Russian products to reach international markets and continue funding Russia’s war in Ukraine. Where there is money to be made, Russia, like Iran, will always try to circumvent sanctions. However, more action should be pursued to make U.S. partners, such as India and the United Arab Emirates where many of the ghost ship subsidiary companies are housed, think twice about if they want to be complicit in Russia’s shipping disasters.
Katherine Camberg is a Research Assistant at the American Enterprise Institute where her research primarily focuses on issues related to the EU, sanctions evasion, and shipping. She graduated Summa Cum Laude from George Mason University with a bachelor’s in Global Affairs and a minor in German Studies. She can be found on LinkedIn.
The views expressed in this piece are the sole opinions of the author and do not necessarily reflect those of the Center for Maritime Strategy or other institutions listed.
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By Katherine Camberg
Since Russia’s invasion of Ukraine in 2022, Russia has joined Iran and other pariah nations in using “ghost ships” to transport oil and other goods and bypass international sanctions. Russia’s ghost fleet primarily consists of older vessels that have a higher risk of breaking down and being involved in accidents. Beyond the inherent risks of using older, run-down vessels, ghost ships also engage in risky behavior by turning off their Automatic Identification Systems (“AIS”) and spoofing their locations to conceal illegal activities. For months, maritime experts have been warning of these vessels’ potential to cause harm. Such accidents involving Russian and Iranian ghost ships are already occurring at a higher frequency than many realize. Smaller accidents often go unnoticed and unpunished. With around two thirds of Russian tankers being insured by unknown companies, accountability is difficult. As Russia has shifted its oil sales to be covered by the ghost fleet, which by some estimates consists of up to 650 vessels, more incidents can be expected. To tackle this challenge, the U.S. and its allies must either step up enforcement of current laws on third-party companies enabling ghost shipping or update existing sanctions to address the current realities of Russian shipping.
What is a “Ghost Ship”?
Ghost ship incidents are not making headlines, despite many predictions of the risks involved, because these ships are inherently difficult to identify and track. The U.S. and its allies sanctioned Russian shipping lines such as FESCO and Sovcomflot, but many subsidiary companies have sprung up in their place. Take for example Sun Ship Management Ltd. of Dubai. The company took over management of over 90 tankers that previously belonged to Sovcomflot, after sanctions were imposed. Despite denying its connection to Russia, Sun Ship was later sanctioned as a subsidiary of Sovcomflot.
However, sanctioning companies like Sun Ship is like playing whack-a-mole. When companies are exposed for their links to Russia, more subsidiaries spring up in their place. For example, an India-based company, Gatik Ship Management, emerged seemingly out of nowhere as a major shipper of Russian crude after war broke out in Ukraine. After attracting international scrutiny, it sold off its ships to a milieu of previously unheard of companies tangentially linked to Gatik. Since 2022, a shocking 864 maritime companies linked to Russia have been created.
The complicated web of ownership and the lack of a clear definition for what qualifies as a ghost ship has meant that, even when these ships are involved in accidents, the media often does not notice. There is no agreed upon definition for ghost ships, and their constant adaptation to sanctions makes them harder to identify. For example, though ghost ships are typically old vessels, some fleets have been taking in middle-aged vessels to avoid detection. Linking ships involved in accidents to ghost fleets is also inherently difficult as ships change flags often and are owned by shell companies, as was the case with Gatik’s fleet. Additionally, much of the conversation focuses on the actions of Russian and Iranian tankers, but their clandestine cargo shipping has also broken sanctions and led to accidents.
The American Enterprise Institute (“AEI”), a think tank in Washington D.C., cross-referenced reported incidents from KPLER’s FleetMon with ownership data from Equasis and Russian ship registries. AEI has identified over 40 incidents in 2023 that have a high likelihood of ghost ships being involved. These incidents range from engine failures and fires, to explosions and collisions. The ships involved in these incidents are owned by companies either directly linked to Iran and Russia or that are operating as subsidiaries, much like Gatik and Sun Ship. Only a handful of these incidents were highlighted in other comprehensive reports of ghost ship incidents.
Consequences of Ghost Shipping Incidents
Beyond their role in supporting Russia’s war machine, ghost ships are harming the environment and endangering crews. Take the example of one ghost ship, Pablo, which exploded off the coast of Indonesia in summer of 2023. Built in 1997, the ship was set to be sold as scrap five years ago before, instead, joining Iran’s shadow fleet. On May 1, 2023, the ship erupted in flames, killing three crewmembers and seriously injuring four others. Following the wreck, oil washed up on the shores of Indonesia, and Indonesia experienced massive air pollution. Without a known insurer, Malaysian authorities were forced to deal with the incident. Had it been carrying its full capacity of 700,000 barrels of oil at the time of the accident, billions of dollars of environmental and economic damage could have occurred in the Malacca Strait, a high traffic shipping area home to extensive fisheries and productive coastal ecosystems.
However, in many incidents, ghost ships mitigated the potential impact of the accidents. For example, the two ghost ships Mercury and Agnes, managed by Gatik Ship Management at the time of the incident, lost control of their vessels and were dragging their anchors in the Bay of Gibraltar. They were rescued by nearby tugs and prevented from causing harm to docked ships. The incident garnered little media attention, despite the ships’ clear link to the ghost shipping network.
Although the conversation around ghost ships is typically centered on tankers, cargo vessels linked to Russia have also been involved in a number of serious incidents. For instance, Russian-flagged cargo ferry Slavyanin collided with another ship in the Black Sea this month. In February 2023, Fesco Tatarstan, a 15 year-old Russian-flagged cargo ship, leaked methane and required a specialized crew to come clean up. Sergey Bodrov, a cargo ship belonging to Turkey’s Clan Ship Management, a company linked to Russian trade, nearly collided with Norwegian oil fields last month, after its engine failed. Regional coast guards stepped in to prevent catastrophe.
Despite improvements in safety for shipping over the past decade, the risk of incidents from ghost ships has increased. To further improve safety in the maritime community, countries must address the various problems of ghost ships. Countries are beginning to crack down on ghost shipping by denying ghost ships entry to their ports or detaining them. EU sanctions outline that ships who turn off their AIS trackers while transporting Russian oil will be denied entry to their ports. Coast guards can play a role by seizing ships involved in illegal oil transfers, as the Indonesian coast guard did with Iranian tankers in July 2023. Stricter enforcement of such rules and the adoption of ghost ship related sanctions by more nations will improve maritime security.
Additionally, as more ships are exposed for being part of ghost fleets, they have lost their insurance coverage and are removed from registries. One avenue to adapt sanctions to meet the current problem would be to require vessels transiting various choke points such as the Gulf of Finland to show proof of insurance. Ghost ships, which are by nature difficult to insure, would be forced to take longer routes or upgrade their safety standards.
Ghost ships threaten maritime safety, harm the environment, blatantly subvert U.S. and E.U. sanctions, and allow Russian products to reach international markets and continue funding Russia’s war in Ukraine. Where there is money to be made, Russia, like Iran, will always try to circumvent sanctions. However, more action should be pursued to make U.S. partners, such as India and the United Arab Emirates where many of the ghost ship subsidiary companies are housed, think twice about if they want to be complicit in Russia’s shipping disasters.
Katherine Camberg is a Research Assistant at the American Enterprise Institute where her research primarily focuses on issues related to the EU, sanctions evasion, and shipping. She graduated Summa Cum Laude from George Mason University with a bachelor’s in Global Affairs and a minor in German Studies. She can be found on LinkedIn.
The views expressed in this piece are the sole opinions of the author and do not necessarily reflect those of the Center for Maritime Strategy or other institutions listed.