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This content was partly produced in Russia where the law

restricts coverage of Russian military operations in Ukraine.

By Jonathan Saul and Timothy Gardner

LONDON/WASHINGTON, March 6 (Reuters) - Dozens of oil

tankers used by Russia have stopped sailing under the Liberian

and Marshall Islands flags in recent weeks after the United

States ramped up sanctions enforcement on ships linked to those

registries, according to shipping data and interviews with

industry and government officials.

The shift reflects the close relationship between the U.S.

and the flag administration companies of Liberia and the

Marshall Islands, which are headquartered not in their home

countries, but in Virginia, just miles from Washington D.C. and

within the jurisdiction of U.S. sanctions enforcement.

The heavy past use of those flags also represents a

potentially lasting vulnerability for Russia's oil fleet, whose

tankers will remain liable for sanctions violations even after

they have switched to a new flag outside of U.S. reach,

according to energy and sanctions specialists.

"They've created an enduring liability and enduring risk,"

said Craig Kennedy, a center associate at Harvard University's

Davis Center for Russian and Eurasian Studies.

Commercial ships must be registered, or flagged, with a

particular country to ensure they are complying with

internationally recognized safety and environmental rules.

Reuters analyzed LSEG and Lloyd's List Intelligence shipping

data, and interviewed government officials, flag registry

representatives and shipping analysts to provide previously

unpublished details on the role of flag registries in the recent

wave of U.S. sanctions announcements targeting Russia's oil

fleet, and the vulnerabilities they pose to Russian oil

shipping.

The G7, the EU and Australia imposed a $60 a barrel price

cap on Russian oil exports in December 2022 as part of wider

economic sanctions aimed at cutting Moscow's revenues without

disrupting global energy supplies, following Russia's invasion

of Ukraine.

The cap bans the use of Western maritime services when

tankers carry Russian oil priced at or above the cap. A U.S.

official, who requested anonymity when speaking about the

sanctions, confirmed that the Liberian and Marshall Islands flag

registries qualify as Western services.

Since October, the U.S. Treasury Department has imposed

sanctions on some 41 oil tankers for Russian price cap

violations, 24 of which were flying the Liberian flag and one of

which was using the Marshall Islands flag.

Almost all of the other tankers were flagged in Gabon,

including 12 of the 14 targeted by the Treasury Department in

its most recent bundle of sanctions on Feb. 23. Of those

Gabon-flagged tankers, in which Russia's top shipping company

Sovcomflot (SCF) has an interest, at least three had recently

flown the Liberian flag, according to Reuters' analysis of

shipping data.

Those tankers were among a slew of ships in the SCF fleet

moving to Gabon, according to the data: as of early February,

SCF had 42 tankers in its 147 tanker fleet that had recently

shifted to the Gabon flag, mainly from Liberia and Panama.

SCF declined to comment and Russia's transport ministry did

not respond to a request for comment.

The Liberian flag registry told Reuters that all the

Liberian-flagged vessels which were sanctioned were in the

process of having their Liberian flags removed. "We are all

living in a different world right now and the registries need to

adapt to what the global situation is at this point," the

Liberian registry said.

The registry declined to comment on its previous

business with SCF.

A U.S. official told Reuters that Liberia had been actively

engaged with the Treasury Department, and that sanctioned

tankers have about a three-month wind down period to switch to

another flag.

Marshall Islands registry officials are also in contact with

U.S. agencies on the issue, a Marshall Islands registry

spokesperson said.

Gabon Transport Minister Loic Moudouma confirmed to

Reuters that many tankers had left the Liberia registry for

Gabon recently, and said Gabon would de-list them if they are

found to be engaged in illegal activity.

"We are not a flag registry for the world's rogue navigators

or transporters," he said.

"If any ally, any partner in the world, realizes that

there is a Gabonese ship flying the Gabonese flag and carrying

out illegal activities, all they have to do is send us the file

in full and we will take steps to remove the flag from this ship

ourselves. Whether Russian or any other nationality."

Panama officials did not respond to a request for

comment.

INVITING TROUBLE

The sanctions imposed so far have sent a chill through the

industry involved in Russian trade.

Many of the still to be de-listed Liberian-flagged vessels,

for example, are stuck, sitting at anchor outside of ports

across the world including in the Black Sea, according to

shipping data, marking a costly liability for their owners and

those financially linked to their cargoes.

U.S. Treasury Department sanctions can have a "contagion"

effect on tankers by dissuading market players from dealing with

them, according to Harvard's Kennedy.

"In the dollar denominated world of oil trading, why put a

deal worth tens of millions of dollars at risk by using a

blocked tanker? You're just inviting trouble for everyone

involved," he said.

Switching to the Gabon flag could also invite additional

risk at ports for tankers carrying Russian oil.

A U.S. official said tankers that carried Russian oil above

$60 that switch to the Gabon flag could also have a more

difficult time with port authorities concerned about the safety

of ageing tankers.

The United States, European Union and UK issued a letter

late last year pressuring Liberia, the Marshall Islands and

Panama to increase oversight of ships carrying their flags to

ensure they do not transport Russian oil sold above the price

cap, a source told Reuters at the time.

While the U.S. has been the primary enforcer of the price

cap, other countries in the mechanism are working with

Washington to tighten the screws.

"We're making it harder for Russia to use its shadow fleet,

which in turn would force more volume back into the G7 fleet,

where service providers are compliant with the cap," Olga

Dimitrescu, an official at the UK Treasury's sanctions

enforcement arm OFSI told a Feb. 1 podcast with ship insurer

NorthStandard.

U.S. officials say shipping practices related to the

export of Russian oil above the West's price cap are in their

crosshairs. "We are very concerned about evasion, I think that's

clear from the actions we've taken," Claire McCleskey, an

official with the U.S. Treasury's sanctions enforcement arm

OFAC, told a New York shipping conference last month.

"You can anticipate our continuing to take action."

(Additional reporting by Gerauds Wilfried Obangome in

Libreville, Alphonso Toweh in Monrovia, Alessandra Prentice in

Dakar, Gleb Stolyarov, Laura Sanicola and Moscow bureau; editing

by Richard Valdmanis and Anna Driver)