It’s hard not to admire the sheer industriousness that sanctions inspire. While Western governments draw lines in the sand over the price of Russian oil, a vast and rather murky enterprise has blossomed on the high seas. A recent, meticulously detailed report by Jeremy Domballe, Byron McKinney, Ines Nastali, Max Lin, and Anna Koldova for S&P Global, titled “Maritime shadow fleet: Formation, operation and continuing risk for sanctions compliance teams in 2025,” lays bare the mechanics of this flourishing venture. It reveals a sprawling network of tankers, insurers, and shell companies all dedicated to the simple, time-honoured principle of selling oil to willing buyers, regardless of what Whitehall or Washington might prefer.
The scale of this operation is, frankly, impressive. We are not talking about a few rogue vessels darting through the night. The report identifies a core maritime shadow fleet of 940 tankers, a figure that has swelled by 45% since May 2024. These ships constitute a formidable 17% of the global tanker fleet. If one includes every vessel that has merely touched a Russian, Iranian, or Venezuelan cargo since the sanctions tightened, the number leaps to 3,154 ships. That is nearly half the world’s tankers. It seems that for a significant portion of the maritime industry, business as usual has morphed into a new, more creative business model.
To make sense of this rather complex ecosystem, the S&P analysis helpfully categorises the fleet into tiers of risk. Tier 1 is the highest-risk category, a veritable who’s who of sanctioned vessels and state-owned entities from Iran, Russia, and Venezuela. These are the known unknowns, the ships openly defying the rules. Tier 2 is arguably more interesting. It comprises 420 vessels of opaque ownership, often flying the flags of nations known for their, let’s say, flexible approach to registration, such as Panama. These ships are the ghosts in the machine, their ownership structures designed to be as clear as mud. Then we have Tier 3, the largest and perhaps most revealing group.
The ghosts in the machine
Delving into the anatomy of the high-risk fleets (Tiers 1 and 2) is like peering into a scrapyard with a purpose. The average age of a vessel in this shadow armada is a creaking 20-21 years, a stark contrast to the 13-year average for the mainstream tanker fleet. One doesn’t need to be a naval architect to understand what this means. Older ships require more maintenance, present higher operational risks, and are, statistically, more likely to cause a catastrophic environmental incident. It appears the cost of a potential oil spill is a risk some are perfectly willing to take, especially when there is no one to send the bill to.
And that is precisely the point. A staggering 64% of the Tier 2 fleet operates without any known Protection and Indemnity (P&I) insurance. These are not merely uninsured vessels; they are uninsurable liabilities sailing through the world’s busiest shipping lanes. In the event of a collision or a spill, the cleanup costs and damages would fall upon coastal states or, more likely, simply go unpaid. This is not just sanctions evasion; it is the wholesale outsourcing of risk to the international community.
The ownership structures are a masterclass in corporate obfuscation. The report notes the proliferation of Single Ship Fleets (SSFs), where a separate company is established for each vessel. Between 2022 and 2024, 362 new registered owner companies were founded for the 420 vessels in Tier 2 alone. These entities pop up in jurisdictions like the UAE, India, and Hong Kong, making it nearly impossible for compliance teams to trace the ultimate beneficial owner. It is a brilliantly simple way to ensure that if one ship is caught, the rest of the network remains untouched.
The Greek nexus: Tiers 3’s operational powerhouse
Greece’s maritime sector occupies a paradoxical space in the shadow fleet story—legitimate on paper, indispensable in practice, and curiously absent from most policy conversations. According to the S&P Global report, Tier 3 comprises 2,217 tankers—70% of the core shadow fleet. Around half of these vessels are owned by companies domiciled in Greece. Additionally, 32% (710 vessels) are operated by Greek-based firms, while 161 list Greek-domiciled beneficial owners.
Greek ownership and operational control, however, is only one facet. The national flag itself plays a notable role: 331 Tier 3 tankers sail under the Greek or Maltese flag, with Greece just behind traditional flags of convenience such as Liberia, the Marshall Islands, and Panama. Put simply, Greek actors are deeply embedded across every layer of the Tier 3 ecosystem—flag, management, and ownership.
Greek-controlled vessels, particularly medium-range (MR1 and MR2) tankers, have also become the workhorses of Russia’s refined oil export strategy since sanctions were imposed. These vessels account for 42% of Tier 3 ships and have maintained the flow of Russian diesel and naphtha from the Baltic to Turkey and beyond, ensuring uninterrupted delivery through short-haul maritime corridors even as traditional European markets closed their doors.
Greek waters: The invisible stage for global oil redistribution
More than a back-office maritime power, Greece plays a frontline role in Russian oil’s post-sanctions journey. In 2023, ship-to-ship (STS) transfers off Kalamata and Laconia Bay, along with Ceuta in Spain, accounted for 90% of all transshipment activity involving Russian crude. As Spanish involvement waned in 2024, Greek waters remained a Mediterranean constant, handling a sizable portion of the 10.6 million barrels rerouted that year via Oman and Egypt.
The pattern held into 2025, with Greece and South Korea responsible for over half (52%) of STS activity involving Russian grades. Greek waters—legally accessible, geographically optimal, and loosely policed—offered a convenient midpoint between sanctioned supply and emerging demand.
In parallel, 27 Tier 3 vessels, many under Greek operational control, served as daughter ships in cargo-splitting schemes designed to obscure origin and destination alike. The result: millions of barrels arriving in India, Singapore, and China with plausible deniability—thanks, in part, to Greek waters and Greek vessels quietly doing the heavy lifting.
Britain’s quiet entanglement
Though rarely listed among the headline offenders, Britain plays a quietly pivotal role in sustaining the architecture that enables the shadow fleet to operate. London remains a global hub for ship finance, legal arbitration, insurance, and classification services. British firms and institutions—whether directly or through foreign affiliates—continue to provide essential infrastructure to “grey fleet” operators: risk assessments, technical certifications, even brokerage services. While few UK-domiciled companies appear in the Tier 1 or Tier 2 categories, their indirect exposure is far from negligible.
The S&P Global report stops short of assigning blame, but the evidence is difficult to ignore. The UK regulatory ecosystem, particularly around maritime finance and due diligence, often exhibits a strategic ambivalence—especially when questionable actors operate behind layers of offshore ownership in jurisdictions like the Isle of Man or the British Virgin Islands. This is not necessarily a matter of corruption or collusion; rather, it reflects the systemic tension between Britain’s geopolitical stance and its commercial maritime interests. In a trade where plausible deniability is currency, London’s silence speaks volumes.
A new maritime order
The result of all this activity is a fundamental re-drawing of the world’s energy map. Russian oil, once destined for Rotterdam and Hamburg, now flows in vast quantities to refineries in India, China, and Turkey. This is not a temporary disruption; it is the formation of a new, parallel logistics network operating outside the traditional, Western-regulated framework. The maritime shadow fleet is the circulatory system of this new order.
For compliance teams in London, New York, or Brussels, the challenge is immense. Screening a vessel is no longer a simple matter of checking its owner and flag. One must now analyse its movements, its STS history, its inspection records, and its insurance status. The report highlights that tell-tale signs are often hidden in plain sight: a sudden change of flag, an unusually old vessel, or a spotty inspection history can be indicators of high-risk activity.
Ultimately, the emergence of the maritime shadow fleet demonstrates a simple truth: global trade, much like water, will always find a path. The intricate web of sanctions has not so much stopped the flow of oil as it has made it more dangerous, less transparent, and, for a select group of audacious operators, spectacularly profitable. The phantom fleet sails on, a testament to the enduring power of supply and demand, and a rather inconvenient reminder that not everyone plays by the West’s rules. The continued operation of this maritime shadow fleet is a stark reality of modern geopolitics.