More than 120 billion euros of Russian petroleum insured in England

Despite global sanctions, British insurance companies have played an important role in facilitating the transportation of Russian petroleum.

Alun Cairns, a former cabinet minister, called on the insurance industry to rethink its commitments after it was revealed that British companies had insured more than €120bn worth of Russian petroleum.

Research by the think tank of the Center for Energy and Clean Air Research (CREA) showed that from March 2022, right after Russia's military attack on Ukraine, until the end of November 2023, Russian petroleum worth 120.6 billion euros has been insured by British companies.

CREA's review and analysis is focused on the period between March 2022 and November 2023. It is not illegal to transport or insure Russian petroleum as long as it is sold under the price ceiling of $60 per barrel set by the Group of Seven.

According to a study by this European think tank, 33% of all Russian petroleum (in terms of volume) was transported by insured tankers in England. Of this amount, the major part of Russian petroleum was crude oil (31% worth 14.4 billion euros) and then diesel (22% worth 10.3 billion euros).

Alun Cairns, former Welsh Secretary and Conservative Party MP, said that companies should be aware of the possibility of abuse of the price cap mechanism.

In this analysis, it is noted that although the number of British insurance companies covering Russian crude oil shipments has decreased, Russian oil transit is still dependent on UK-insured ships for transportation.

In the 12 months since the introduction of the petroleum price cap mechanism in December 2022, €46.4 billion worth of Russian petroleum has been transported using tankers covered by UK Protection and Indemnity (P&I) insurance.

According to the Oil Price report, West of England P&I club covered the highest value of Russian petroleum products with 20.1 billion euros, followed by North Standard with 17 billion euros. North and Standard Insurance merged in February 2023 and became North Standard.