Türkiye vows to keep oil tankers lacking insurance out of its waters
Oil tankers wait in the Black Sea off Kilyos near Istanbul, Türkiye, Dec. 8, 2022. (Reuters Photo)


Türkiye will continue to keep oil tankers without appropriate insurance documentation out of its waters and needs time to conduct inspections, the country’s maritime authority said on Thursday, dismissing pressure from abroad over a growing queue of vessels.

In a new measure that has been in force since the start of this month, Türkiye is requiring vessels to provide proof they have insurance in place for all circumstances covering the duration of their transit through its straits or when docking at Turkish ports.

About 20 tankers were anchored in the Black Sea as of Friday, waiting to pass through Istanbul’s Bosporus on the way to the Mediterranean Sea. Some nine others were waiting at the Dardanelles, bringing the total to 28, the Tribeca shipping agency said.

The Transport and Infrastructure Ministry’s Directorate General for Maritime Affairs said the insurance checks on ships in its waters were a "routine procedure" and stressed it was unacceptable to pressure Türkiye over the measure.

The regulation came into effect before the G-7, the European Union and Australia agreed to bar shipping service providers like insurers from helping export Russian oil unless it is sold at an enforced low price, or cap, to deprive Moscow of wartime revenue.

With that mechanism, Western insurers are required to retain proof that Russian oil covered is sold at or below $60. The industry has a 45-day transition period and a 90-day grace period if the G-7 changes the price cap at a later date.

The maritime authority said that due to the EU sanctions, the protection and indemnity insurance coverage of many ships had become invalid, thus taking compensation in the event of an accident off the table.

"This has been confirmed both by the relevant EU directive and by high-level government agencies in Europe," it said.

Officials this week said Western insurers started to cancel the insurance and that the majority of international insurers no longer provide coverage for Russian crude.

"Türkiye is not obliged to implement the sanctions decisions of other countries and international organizations, except for the sanction decisions taken by the United Nations Security Council," it added.

"We will not take the risk that the insurance company will not cover its liability in the event of a catastrophic accident that may occur if a sanctioned ship or cargo passes through the Turkish Straits."

Considering their vital commercial importance as they connect the Black Sea with the rest of the world, the Turkish Straits became a major point of discussion with the eruption of the Russia-Ukraine war on Feb. 24.

The passages are among the world’s most difficult waterways to traverse, as ships must deal with strong currents, sharp turns and varying weather conditions.

The 1936 Montreux Convention guarantees freedom of navigation for merchant vessels passing through Türkiye’s two straits. But it also gives Türkiye the right to regulate security – a provision it is now using to make sure the oil ships are insured against spillage and other accidents.

Millions of barrels of oil per day move south from Russian ports through Türkiye’s Bosporus and Dardanelles straits into the Mediterranean.

The Bosporus, a 17-mile waterway that connects the Black Sea to the Marmara Sea and eventually to the Mediterranean Sea, is one of the world’s most important choke points for the maritime transit of oil.

The 40-mile Dardanelles separately connects the Marmara Sea with the Aegean and Mediterranean.

The maritime authority said that in the event of an accident involving a vessel in breach of sanctions it was possible the damage would not be covered by an international oil-spill fund.

It said it could remove tankers without proper documentation from its waters or require them to furnish new protection and indemnity insurance letters covering their journeys through its territory.

Ships typically have protection and indemnity insurance, which covers third-party liability claims including environmental damage and injury. Separate hull and machinery policies cover vessels against physical damage.

"(It) is out of the question for us to take the risk that the insurance company will not meet its indemnification responsibility," the authority said, adding that Türkiye was continuing talks with other countries and insurance companies.

In a separate statement, the Transport and Infrastructure Ministry said insurance companies have refrained from issuing a confirmation letter regarding ships waiting in the Turkish Straits due to European Union sanctions on Russian exports.

It said a different application will soon be required regarding ships that arrive at refineries in Türkiye but are not issued a confirmation letter.

"Insurance companies routinely refrain from providing this confirmation letter, which is requested and provided on an incident-by-incident basis, in the case of our country," the statement read.

The maritime authority said the vast majority of vessels waiting near the straits were EU vessels, with a large part of the oil destined for EU ports, something that it said was "unacceptable" to be used as a means to pressure Türkiye.

The U.S. Treasury said on Thursday that the price cap on Russian oil does not necessitate checks of every tanker passing through Turkish waters and that Ankara has made clear it is working quickly to resolve the issue.

A Treasury spokesperson said that Türkiye shares U.S. interests in maintaining a well-supplied oil market.

"We’ve been in touch with Turkey about how the price cap only applies to Russian oil and explained that the cap doesn’t necessitate additional checks on ships passing through Turkish waters," the spokesperson said in a statement.

"Our understanding is that virtually all of the delayed tankers are not carrying oil from Russia and are not affected by the cap."

In a telephone call on Wednesday, U.S. Deputy Treasury Secretary Wally Adeyemo told Deputy Foreign Minister Sedat Önal that the cap applied only to Russian oil and did not necessitate additional checks on ships crossing Turkish territorial waters.

Türkiye has had to balance its good relations with both Russia and Ukraine since Moscow invaded its neighbor in February. It played a key role in a United Nations-backed deal reached in July to free up grain exports from Ukrainian Black Sea ports.