Since February 5, 2023, it is prohibited to import Russian refined oil products to the EU by sea, adding to the previous ban on Russian crude oil. Despite these measures, Russian oil export is flourishing, along dark routes. It’s time to bring light to the oil trade.
Ghost ships filled with shadowy oil
Russian oil export amounted to 3,7 million barrels a day in January 2023, more than any time in 2021, According to The Economist.
A ghost fleet of at least 600 vessels that ship Russian crude oil or refined oil products has appeared on the seas, switching from mainstream trade to “Russian business.” These ships may sail without transponders, be repainted several times on route, and change name in the middle of the sea.
Simple arithmetic shows that there are large amounts of shadowy oil drifting in the world market. For example, Malaysia exports 1,5 million barrels a day to China, even though it only produces 400 000 barrels a day.
Such discrepancies are possible since there is no mechanism to trace all fossil fuels to their sources. That is also a fundamental reason why sanctions against Russian oil products have proven ineffective.
The predicament is reflected in the way these sanctions work. They can be circumvented by Russia exporting crude oil to China or India, where it is refined to petrol or diesel. These oil products may then be legally imported to the EU. The country of origin becomes the country where the refinery is located, rather than the country of origin of the crude oil.
Among fossil fuels sold in Sweden in 2021, no less than 48 percent were made of raw materials with unknown country of origin outside the EU/EES, according to the reporting by domestic fuel companies to the Swedish Energy Agency.
We can trace fossil energy if we want to
Already in 2011, the EU commission proposed that fuel companies should report all raw materials of the fossil fuels and their countries of origin at the level of mass balance. Fossil fuels with different origin may then be blended, as usual, but there must be a system in place that keeps track of the amount of fossil fuel of different origin that enters and exits each step in the value chain.
A report commissioned by Transport & Environment demonstrated that it is possible to construct such a system. Because of the needs of the industry, a large amount of documentation already accompanies each batch of oil that is bought and sold. For example, since the quality of the oil depends on its origin, the refineries need to know the oil field from which the oil is extracted.
The administrative burden to achieve full traceability is therefore limited. All that is needed are new data entries in documentation that already exists. If the cost of a system for traceability was carried by the consumers, the raise in price per litre at the fuel station would be less than a thousandth of an American dollar or Euro, according to the report.
Do it now
Yesterday, IS financed a brutal war with shadowy oil, today Russia does the same. What comes next? Transparency is a prerequisite to break the evil link between oil and war.
Green Mobilists Sweden has argued for several years that such transparency must be implemented. When Russia invaded Ukraine, 26 European environmental organisations, including one from Ukraine, demanded that the country of origin of the crude oil should be disclosed at refuelling stations, for consumers to be able to avoid Russian oil.
In May 2022, the Swedish parliamentary Committee on Industry and Trade urged the Swedish government to push the EU to develop a regulatory framework for tracing and disclosing the origin of fossil energy.
Six of the eight parties in the Swedish Parliament promised to work towards this goal in the EU, when asked by Green Mobilists Sweden before the general election in September 2022. Among those where the two largest parties in the present governing coalition, the Sweden Democrats and the Moderate Party. There is a golden opportunity to fulfil the promise right now, as Sweden holds the Presidency of the European Council until summer 2023.
Level the playing field – give renewables a chance
Thanks to the EU, bioenergy is traceable since almost 15 years, in the same manner as suggested for fossil energy, and there are guarantees of origin on the electricity market.
The origin of the electricity delivered by the supplier is shown on the bill, at least in Sweden. In September 2022, the European Parliament adopted a new version of the Renewable Energy Directive that requires the raw materials of biofuels and their geographic origin to be disclosed on eco-labels on fuel dispensers across Europe.
This is commendable, but what about fossil fuels? We must get rid of them not only because they fuel war and fatten dictators, but because they fuel climate change. Nevertheless, they are favoured since they are much less regulated than electricity and biofuels. This imbalance must come to an end.
Sweden has tried to take the lead in that respect. Since fall 2021 there are eco-labels on fuel dispensers across Sweden, disclosing the climate intensity and raw materials of each transportation fuel, fossil and renewable alike. A link is provided on the label to a webpage where countries of origin are listed.
However, since it is still impossible to trace all fossil fuels, we often read country of origin unknown on this list. Unfortunately, the ghost ships and their phantom crew are still allowed to operate. They sneak all the way up to our cars to deliver their cargo. We pay them, and they hand the money to their masters.
A bill requiring warning labels on gas pumps in Hawaii, informing customers of the climate and health effects of burning fossil fuels, was recently adopted by their Senate Committee on Agriculture and Environment. Maybe such labels should also include a warning that buying fossil fuels increases the risk of war, just like we are warned that buying drugs from dealers increases the risk of crime and gang violence, as the thugs fight to control the market.
When expressed in these general terms, such a warning applies not only to Russia or rogue players like the IS, but to all powers with major interests in fossil energy. Unfortunately, we still depend on them, like drug addicts.
manager of the campaign We Want to Know by Green Mobilists Sweden
Featured image: The Flying Dutchman, by Charles Temple. Source: Wikimedia