Tankers of Russian oil a prime target for western sanctions

Tankers of Russian oil a prime target for western sanctions

Earlier this month Boris Johnson, the British prime minister, grabbed headlines by travelling to Kyiv to demonstrate his solidarity with Volodymyr Zelensky, the Ukrainian president.

It was eye-catching, tub-thumping stuff. But if Johnson wants to support Ukraine against Russia’s invasion, he now should make a symbolic visit to a closer destination: the headquarters of Lloyd’s, the world’s largest insurance marketplace, in the City of London.

Thus far, the insurance industry has attracted little public scrutiny compared with banks, in relation to the west’s sanctions against Russia. No wonder: most politicians (and voters) have only limited awareness of the sector’s complex but crucial role in finance and trade.

But the industry matters deeply now. If the British government, along with its EU and US counterparts, were to demand that insurance companies stop protecting tankers carrying Russian oil, it would be another potent weapon in western efforts to squeeze Moscow.

To understand why this matters, consider current oil flows. In recent weeks, rising outrage about Russian aggression has prompted some western companies, such as Shell, to self-sanction by (belatedly) refusing to touch Russian oil. And the Biden administration has also imposed an oil embargo, albeit one that has mostly symbolic value.

But that has not stopped exports.