Iran is reportedly evading U.S. sanctions and clandestinely shipping significant quantities of crude oil to China, marking a concerning development in global trade. The recent seizure of the oil tanker St. Nicholas by Iran's Navy in the Gulf of Oman serves as clear retaliation for the United States seizing the same vessel months earlier and uncovering what was identified as smuggled Iranian oil under sanction.
This provocative action, along with others, highlights the potential threat posed to the global economy and calls into question the sustainability of such activities. The St. Nicholas is just one of many vessels actively disregarding U.S. sanctions, transporting crude oil, and enabling Iran's economy. Experts refer to these vessels as part of the 'Dark Fleet' or 'Ghost Armada,' comprising an estimated number ranging from 300 to 560 tankers, typically of older origin and difficult to trace in terms of ownership.
To evade detection, these vessels often turn off their transponders and seek refuge in lawless areas of the open sea. They also take advantage of weaker nations willing to allow their flags to be flown in exchange for a fee, primarily shipping the sanctioned oil. Approximately half of these vessels are registered under the Panama flag, prompting a bipartisan group of U.S. congressmen to exert pressure on Secretary of State Antony Blinken to urge Panamanian leaders to de-flag all vessels involved in evading U.S. sanctions.
In 2019, Iran's oil exports were restricted to approximately 400,000 to 600,000 barrels per day. However, with the assistance of the Ghost Armada, that figure has surged to an estimated 2.4 million barrels per day. Presently, it is reported that more than 300 vessels are actively engaged in smuggling Iranian oil across the seas, enjoying a certain level of impunity.
The U.S. State Department emphasizes the resources that Iran's government must allocate to evade U.S. sanctions and operate within the black market. Consequently, their profits are significantly diminished compared to what they would earn in the legitimate market.
In response to these developments, there is a growing demand for the U.S. administration to enforce existing sanctions and tighten the grip on nations engaged in business with Iran. The concern regarding the Ghost Armada and its impact on global trade underscores the importance of cohesive international efforts to combat illicit activities and safeguard economic stability.
