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THE MARITIME SECTOR What's Going on With Shipping? ... Sal Mercogliano, maritime historian Russia Begins Escort of Shadow Fleet in the Baltic \| What is the Parallel Fleet? \| Cable Cutting PLAY YOUTUBE VIDEO Original article: https://www.youtube.com/watch?v=ewpD0fTqdzA Peter Burgess COMMENTARY Peter Burgess
Russia Begins Escort of Shadow Fleet in the Baltic \| What is the Parallel Fleet? \| Cable Cutting What's Going on With Shipping? May 31, 2025 519K subscribers ... 176,385 views ... 12K likes #cablecutter #baltic #russia Russia Escorts Shadow Fleet in the Baltic May 30, 2025 In this episode, Sal Mercogliano — a maritime historian at Campbell University (@campbelledu) and former merchant mariner — discusses the Russian decision to escort ships of the Shadow Fleet in the Baltic. What is the background on the Shadow Fleet, issues in the Baltic and what does depress oil prices mean going forward? #supplychain #baltic #darkfleet #shadowfleet #russia #cablecutter Support What's Going on With Shipping via: Patreon: www.patreon.com/wgowshipping Twitter: @mercoglianos Bluesky: @mercoglianos.bsky.social Facebook: @wgowshipping Email: mercoglianosal@gmail.com Spotify: https://open.spotify.com/show/0B9AHrs... Marine Traffic ... marinetraffic.com Ukraine’s ongoing agony could alter the face of shipping forever https://www.lloydslist.com/LL1153613/... Finland Reports Russia Has Begun Naval Escorts for Shadow Fleet Tankers https://maritime-executive.com/articl... Russian naval escorts raise stakes in Baltic security stand-off https://www.lloydslist.com/LL1153663/... Finland Nears Completion of Criminal Investigation as Cable Repairs Proceed https://maritime-executive.com/articl... Why governments are turning up the heat on flag states https://www.lloydslist.com/LL1153712/... Estonia Says Russia Detained A Tanker In Baltic Sea https://gcaptain.com/estonia-says-rus... Estonian PM Vows To Keep Up Checks On Russia’s ‘Shadow Fleet’ https://gcaptain.com/estonian-pm-vows... EU’s Largest-Ever Dark Fleet Sanctions Package Still Leaves Major Gaps https://gcaptain.com/eus-largest-ever... Poland Says Key Infrastructure at Risk After Baltic Sea Incident https://gcaptain.com/poland-says-key-... Report: Russian Naval Escorts Guard Shadow Fleet in Gulf of Finland https://gcaptain.com/report-russian-n... EU Unveils Black Sea Maritime Security Strategy Amid Escalating Threats https://gcaptain.com/eu-unveils-black... Falling Russian Oil Prices Drive Exports’ Value to Two-Year Low https://gcaptain.com/falling-russian-... Western Oil Tanker Firms Flock Back to Russia After Price Plunge https://gcaptain.com/western-oil-tank... Russia’s ‘Shadow Fleet’ Readies for Summer as Sanctioned LNG Carriers Receive Permits for Arctic Route https://gcaptain.com/russias-shadow-f... 2025 Marine Money Week https://www.marinemoney.com/events-2-... Transcript 0:00 on this episode of what's going on with shipping Russia has begun to escort elements of the shadow fleet in the Baltic I'm your host Sal Mercogliano welcome to today's episode so series of stories highlighting issues up in the Baltic Sea with the Russian Navy coming out to escort ships that are included in what is known as the Dark Fleet the Shadow Fleet the Gray Fleet the Parallel Fleet we're going to break this all down for you so you understand what this means and the impact this may have if you're new to the channel hey take a moment subscribe to the channel and hit the bell to be alerted about new videos as they come out so this is the story over in Lloyd's list Ukraine's ongoing agony could alter the face of shipping government restrictions in the emergence of a parallel marine insurance sector risk cementing divisions deeper than those during the Cold War okay what does that mean S so take us back to February of 2022 Russia invades Ukraine i'm not going to go into the background of this it's because we're talking about this the impact it has in shipping not whether or not all the reasons behind this conflict suffice it to say 1:04 Russia invades Ukraine the EU the G7 the UK all these other nations everybody Australia all these nations want to punish Russia for this invasion the problem is they want to hurt Russia but at the same time not cause the global economy to spiral into a depression in particularly one of the things they want to hurt Russia with is their ability to make money off their energy which they export but same time they still need that sweet delicious crude and diesel fuel to fuel the world's economy so they come up with a novel way of doing this and it's not really novel they had done this against Venezuela and Iran in the past basically what they do is they impose a price cap uh they decide to cap the sale of Russian crude oil at $60 a barrel and Russian diesel fuel at $100 a barrel and the mechanism they use is insurance now insurance is the way you do everything in shipping and in the case of the G7 in the EU they use these 12 companies right here 2:04 these 12 companies right here there we go uh these are the 12 members of the international PNI group the protection and indemnity group they ensure probably between 80 and 90% of the world ships uh and PNI clubs do the bulk of insurance for vessels and understand vessel insurance is a lucrative market but it's also a very expensive market take the Dolly for example in Baltimore dolly was insured by one of these 12 groups and one of the reason these these clubs work together under the international PNI group is because for large payouts they need to pull their resources together dolly is insured up to $3.1 billion that's through one of these 12 insurance groups and then they pull it together they have what's called reinsurance insurance for insurance companies and they can pull their resources because again global shipping payouts can be astronomical in scale and what the EU and the G7 figured is if the PNI clubs are not pro 3:05 excuse me if the PNI clubs are not providing the insurance for the Russian ships they won't sail 3:11 well you didn't understand the Russians because what the Russians decided to do was to get out of 3:18 this mechanism and they created what are what's called the dark fleet the gray fleet the shadow 3:22 fleet or again the parallel fleet it's literally a separate group of merchant ships operating outside 3:29 the bounds of the international norms they don't have these 12 clubs insuring them instead they get 3:34 other insurance or they have no insurance for them they go get registrations or registries in nations 3:40 outside the norm they're not going to Panama Liberia and the Marshall Islands which ensure 3:44 which flag 50% of the world ships they're going to countries that have a lot of questionable assets 3:50 they're also not stopping in countries for fuel uh to do transfers they are sailing from Russia 3:58 to ports of destination in India and China so that the ships are not subject to port state control 4:04 this is the ability of nations to inspect other flag nations to ensure they're meeting 4:09 the standards set by the International Maritime Organization so what we've seen since February 4:15 of 2022 is this attempt to sanction the Russian fleet and in the Russian efforts to circumvent 4:22 those fleet then you have this story from maritime executive finland reports Russia has begun naval 4:27 escorts for the shadow fleet tankers so now the Russian Navy the Baltic fleet specifically is 4:33 running safeguard for the ships of the shadow fleet which raises the question okay why are 4:39 they doing that and what we see is really a series of issues that are prompting this effort and it 4:46 raises the potential for a high seas confrontation between ships of the Baltic states this is Estonia 4:54 Latafia Lithuania it's Poland it's Germany it's Denmark it is Sweden and in Finland dealing with 5:01 the passage of vessels from Russia out through the Danish Straits out into the international 5:06 market so one of the things that's prompting this is the Baltic Sea has become a battleground 5:12 for what we call grayzone operations not direct confrontation between Russia and other nations 5:18 but indirect conflict in particularly a series of attacks accidents whatever you want to call them 5:25 on cables pipelines underneath the Baltic Sea now you may remember this all started back in 5:30 September of 2022 when three of the four pipelines of Nordstream 1 and 2 were destroyed by explosive 5:37 blasts and depending on who you're following who you want to listen to this was the Russians this 5:43 was the Americans this was the Germans this was the Poles this was the Swedes this was Ukrainians 5:48 could be aliens i'm sure there's a channel out there who says that aliens landed and blew up 5:52 the three pipelines of Nordstream but suffice it to say that the pipelines and cables on the 5:58 bottom of the Baltic Sea have become targets and increasing targets so back in October of 2023 a 6:04 container ship the new new polar bear dragged its anchor and severed several links between Finland 6:10 Estonia and Sweden and I'm of the belief that this was an accident i've done a series of videos on 6:17 this and I'll have links above you can go take a look at them but Noo-Noo polar bear was a very 6:21 high visibility ship it was one of the very first container ships that was making the run from China 6:26 to Russia via the northern sea route that is the Arctic route and so there was a lot of press on 6:31 new polar bear and it's a very unlikely candidate for doing an anchor drag because you want to sever 6:38 these cables to punish those three countries for actions against Russia however one of the things 6:44 I think it did do is maybe tell the Russians hey this is not a bad idea that can happen and maybe 6:51 we can begin a prog a program of making this happen because what you're going to see is a 6:56 rash of these take place immediately after new new polar bear in October of 2023 November of 2024 you 7:04 have Yeping 3 this is a Chinese bulker that's leaving from Russia heading out into the Baltic 7:09 Sea it has an anchor drag and it severs several cables between Sweden and the Baltic states uh 7:16 the ship is stopped after it passes through the Danish straits it anchors in international water 7:21 there's a little pocket of international waters north of the Danish straits between 7:26 Denmark Norway and Sweden swedish authorities were allowed to board the vessel question the 7:31 crew but eventually the ship is let go because there's no distinct evidence that links it to a 7:36 kind of malicious attack against it it's believed to have been an accident now Eping 3 set off the 7:42 alarms and so many states were on the lookout for these events so that in December of 2024 you have 7:49 a ship like the Cook Island flag and Cook Island is one of these open registries that has a lot of 7:53 questions you get a tanker like the Eagle S uh which is part of the Shadow Fleet the Parallel 7:59 Fleet it's going to drag its anchor and sever some cables between Finland and Estonia and Finland is 8:06 going to stop the vessel have the vessel head into Finnish waters and do an inspection on the vessel 8:12 and actually hold several of the crew members the ship has since been released however members of 8:16 the crew are being held in Finland as the Finnish courts are basically investigating this situation 8:24 in January of 2025 a ship the multis flagged Vasin was heading outbound from Russia when it dragged 8:30 its anchor and severed cables between Latvia and Sweden in this case Sweden sees the vessel what 8:36 we're seeing here is a increase in the number of incidents happening and the reaction by the Baltic 8:42 states to these ships then in February there was a suspected cable incident where the Swedes and the 8:48 Fins were investigating the potential disruption of their cables so you have the initiation of the 8:54 sanctions against the Russia with the creation of the shadow fleet then you have these cable 8:59 cutting incidences going on in the Baltic and what we just see is the escalation of tension between 9:06 Russia and the nations in and around the Baltic uh sea kind of a new Hanseatic league so here's 9:13 the story from Richard me Russian naval escorts raise stakes in Baltic security he mentions this 9:18 Russia's naval vessels are now being deployed to escort shadow fleet tankers in the Gulf of Finland 9:24 so we just had two incidences recently in the Baltic where Estonia stopped one vessel and failed 9:32 to stop another vessel and the reason they did that is because the ships were stateless in other 9:37 words the flag of registry that they were flying on them were false they lost their registry uh and 9:43 so if you do not have a ship properly registered in other words you are registered in a nation then 9:49 you are a stateless vessel and stateless vessels are not allowed to sail on the world's oceans and 9:54 under UNCCLUS the UN conventional law of the sea nations have a right to stop those vessels until 9:59 they fix the issue in the case of Estonia they stopped one vessel until it was fixed on the 10:05 second case it led to a confrontation with the Russians a Russian jet actually flew out and the 10:10 ship refused to stop as it was heading to Russia so now we see the deployment of elements of the 10:16 Black Sea he goes on in his second point two tanker transits passed without conflict over 10:20 the weekend but naval monitoring has stepped up and the third point he makes is really one of the 10:25 most interesting Comoros which is one of these open registries flags of convenience that are 10:30 out there takes on another politically contentious and previously flagless tanker with a history of 10:37 spoofing in other words of sending out false information about where it's located just as 10:42 it drifts over critical submarine cables for 5 hours and so what we're seeing is these really 10:49 questionable suspicious activities now I have to say the Baltic is crisscross with cables it 10:54 if you drift anywhere in the in the Baltic you're going over cables but you're just raising these 10:59 concerns between the Baltic states and the way the Russians are operating now this comes concurrently 11:05 with this story from maritime executive Finland nears completion of criminal investigation as 11:11 cable repairs proceed these cable repairs are expensive this one for the operation that was 11:17 done by Eagle S uh was anywhere between the cost of 57 to 68 million to repair the power 11:24 cables that run between Finland and Estonia this is not just fixing you know a cut a drop cord this 11:31 is a little bit more extensive than that and so obviously these countries want to minimize these 11:36 impacts and as I said before with new new polar bear accidents can happen you can lose an anchor 11:42 an anchor can drift away if you don't properly secure it the way it's supposed to be if an anchor 11:47 is properly secured it's not going to run on you but if you don't do it it is potential to have an 11:52 anchor runaway the issue that's coming out here is the frequency of these accidents the rapidity of 11:58 them and the fact that the crews are not noticing them and and this is starting to raise issues 12:04 remember we're dealing with very small crews crews that are not paid a lot of wages so that it is 12:09 very easy to perhaps convince a crew member or elements of a crew to undertake these operations 12:16 then we get this last story from Lloyd's list why governments are turning up the heat on flag 12:20 states all countries have the right to run open registries but with rights come responsibility did 12:27 Lloyd's list just channel Stan Lee and Spider-Man i I I'm pretty sure they just did and if that is 12:33 true that is the big story here i mean the fact that we're getting a Marvel reference from Lloyd's 12:38 list I I'm I'm I'm I'm shocked at this but I I'll go with this the open registries and you know I 12:44 you got to be very careful i've always been very careful in the words I choose when I talk about 12:49 like Liberia Panama and the Marshall Islands back in the day 60s,7s they were they were not great 12:56 and you had a lot of issues with them however those registries have cleaned up quite a bit 13:00 there's still issues with with you know obviously with ships in operation you're always going to 13:05 find some problems with any fleet especially when those three represent over 50% of the 13:09 world's oceans but flags of conveniences these are registries that are just in it for the money they 13:15 just want to get some money and they're providing no oversight understand the way we ensure that 13:20 ships are safe on the world seas is through three methods one is actually four methods one is by the 13:25 registry second is by insurance third is by your classification society and then fourth is through 13:32 port state control inspection so there is multiple redundancy going on vessels to ensure they're 13:38 meeting those capabilities what the shadow fleet is doing is eliminating a lot of those they're 13:43 creating registries that are just in it for the money and therefore are providing no oversight uh 13:48 they're creating new classification societies or going to classification societies that have very 13:53 little poor track records uh they're not stopping in countries where port state control can go and 13:58 in some cases the ships are operating without insurance and you may sit there and say 'Okay S 14:03 what does it matter if a ship is operating without insurance do I really care?' Well if an accident 14:07 happens you need that insurance company to pay out those incidences if this ship has a collision 14:13 with a container ship or a passenger liner that ship has no insurance uh and so who pays for the 14:19 cleanup who pays for the loss of life this is a very important element and a lot of this falls 14:24 on the International Maritime Organization all right that sets up the issue let's take a look at 14:30 what we've seen just transpire over the past week all right I'm going to give you a run of stories 14:36 from G Captain to give you just a synopsis of what this means and what the impact has so stories from 14:43 Reuters estonian prime minister vows to keep up checks on Russian shadow fleets so this is before 14:48 Russia announces their escort so the Estonians in particularly are really the ones who are providing 14:54 a check remember Estonia is just outside of Russian territorial waters it along with Finland 15:00 has been the subject to numerous of these attacks so far the story from Mike Schiller eu's largest 15:05 ever dark fleet sanctions package still leaves major gaps we're seeing other elements here to 15:11 target the Russian shadow fleet and particularly individual sanctions so that if you trade or do 15:17 business with any of the ships on this list you will be sanctioned yourself or you can be subject 15:23 to fines so they're using other methods now beyond the insurance uh from the PNI club so again the 15:30 European Union the UK the United States are using these sanction sanction packages the United 15:35 States has been doing this through the State Department's OFAC the Office of Foreign Asset 15:39 Controls uh been doing it for a long time against Iran and Venezuela and they're expanding it now 15:44 against Russia Poland says key infrastructure at risk after Baltic Sea incidents this has got all 15:49 the Baltic states in alignment together again the rebirth of this Hanseatic League of the Northern 15:56 uh states of NATO uh this is you know some people will call this a NATO lake i don't 16:01 like that term because Russia has access to the ocean they you can't block Russian access to 16:08 uh the ocean uh the Baltic Sea the Danish Straits are open passages under UNCLOS article 19 all 16:15 states have the right of innocent passage however if the ships are not innocent if they're flagless 16:21 if they're perpetrating sabotage particularly against communication cables then states do have 16:27 a right to stop those vessels and investigate them and this is a confrontation we're seeing 16:33 now up on the Baltic here's the story from Mike Schuler G Captain russian naval escorts guard 16:39 shadow fleet in the Gulf of Finland this could be a real big question about does the Russians 16:43 have the assets to actually do this uh the Russian Baltic fleet is not one of the biggest fleets that 16:49 the Russians operate and the volume of traffic that goes through the Baltic is actually quite 16:53 large at any one moment you can see about 2,000 vessels operating up and around the Baltic give 16:59 you an idea this is marine traffic here is the Baltic Sea this is the Russian ports primorsauga 17:06 uh St petersburg this is where the Russian ships are coming out sailing through the Baltic Sea 17:11 heading through those narrow Danish straits between Denmark Sweden and Norway and then out 17:16 into the North Sea here you can see the volume of tankers that are just coming through this 17:21 area almost exclusively heading up here toward Russia so a lot of traffic that would have to 17:28 be monitored by the Baltic states uh and when I say Baltic states I'm not just meaning Estonia 17:34 Latafia and Lithuania i'm talking about all the nations in and around the Baltic this story was 17:39 interesting a little bit outside the what we're talking about here but the EU is unveiling a Black 17:43 Sea maritime security strategy amid escalating threats i assume we'll see one coming from the 17:49 EU and NATO regarding the Baltic Sea very soon although it has taken the EU 3 years to start 17:55 to unveil a Black Sea maritime strategy there's no telling but I think the Baltic has got everyone's 18:00 attention in a much better way than the Black Sea ever did this is the other thing that's 18:05 really twisting this story a bit falling Russian oil prices drive exports value to 2-year low the 18:12 falling value of oil right now is forcing Russia to export more energy because of the the decreased 18:19 value they have to increase their exports to keep their revenue up at the same time as the price of 18:26 oil and diesel fall below the price cap Western oil firms are flocking back to haul Russian uh oil 18:33 again the sanction that's in place the the price cap is $60 for crude oil $100 for diesel well 18:41 it's below that now and so Western companies with PNI insurance with correct registries can now go 18:48 haul that fuel with no problems now they may not be able to offload in certain countries because 18:52 of sanctions and issues but they can assume the transportation that was being done by ships of the 18:58 parallel fleet and then this last story Russia's shadow fleet readies for summer as sanctioned LG 19:04 carriers receive permits for Arctic route we're seeing Russia working with nations like Qatar 19:09 and others to increase their export of liqufied natural gas this is a huge amount of revenue for 19:16 the Russians they are flooding the market with LG right now the three biggest LG exporters in the 19:21 world United States Qatar and Australia but Russia is emerging as one of the biggest principally with 19:27 their own fleet of LG carriers that were built in Korea for them they're shifting that now they're 19:32 going to get some ships built in China to do this but Russia is on the precipice of becoming one of 19:37 the top LG exporters and they're looking to get it out and this Arctic route gives them a unique 19:43 ability because it's a much shorter distance is more economical more efficient they can haul more 19:49 liqufied natural gas because their ships don't have to go long distances principally with the 19:54 Houthi we have not seen a huge amount of LG carriers loaded LG carriers going through the 20:00 region uh but again that's all changing as things are in flux over in the Red Sea so that's my quick 20:05 rundown on what's happening in the Baltic with the Russians and the parallel fleet uh it's a lot 20:11 I know but it's a complex issue it's not easy to boil it down into a Tik Tok 60-cond thing 20:17 uh because it does involve a lot it is everchanging but it is a point of 20:22 confrontation baltic Sea and we've seen this with the Black Sea we've seen it with the Red Sea now 20:26 we're seeing with the Baltics we see it with the South China Sea we see it in the Western 20:29 Pacific uh we're just seeing a lot of these lural regional seas becoming much more important and 20:37 again presence there by navies and operations by coast guards and navies are points of potential 20:45 confrontation between rivals remember armies don't run into each other by accident they're they're 20:50 separated by boundary lines on the ocean that doesn't happen so what do we see we see navies 20:55 and coast guards bumping into each other literally at some points and having these confrontations so 21:02 I hope you enjoyed today's episode i want to make you aware of an event that's happening up in New 21:06 York City in Midtown up at the Pierre Hotel uh it is Marine Money Week in New York uh this is 21:12 an annual event that takes place uh this is kind of the who's who of global shipping the reason I 21:18 raise this to you is because on Monday with the opening event it's focusing on revitalizing US 21:24 maritime industries opportunities for American and international ship owners and investors 21:28 this event is going to be kicked off with a keynote speech by Senator Mark Kelly Democrat 21:33 from Arizona is one of the co-authors along with Senator Young from Indiana Republican of the Ships 21:40 Act going to have Wilbur Ross the former Secretary of Commerce during the first Trump administration 21:45 as a panel speaker so you get your left and your right you get your Democrat and your Republican 21:49 and sandwiched in between there is yours truly giving a quick little talk 25minut talk on the 21:55 ships act and the US trade representatives section 301 i'm going to be talking about how did we get 22:01 here a brief history of US maritime policy and some key points affecting US and international shipping uh really excited about the opportunity to do it marine Money will record these events and I hope to be able to get that uh posted up on my YouTube channel once it is available for you i'm really hoping to get some great insight and maybe invite some of these key players it's a three-day who's who of global shipping lots of CEOs a lot of big people talking uh so I'm just excited to be able to sit there as a fly on the wall and uh hear what is going on uh I think a lot of the reason for the invite to this is not just me but you the viewer of this you got us over a half a million subscribers uh you've made what's going on with shipping a kind of a go-to site for people to learn about shipping and I want to thank everyone who's done that we're getting close to a couple other milestones going over 100 million views of the channel over 10 million hours of 23:03 people watching this channel what is wrong with you people 10 million hours of watching me this this 10 million hours i got to tell you my wife my family even my dogs don't want me for an hour and yet almost 10 million hours of the channel i am just absolutely floored and thankful for all of you so I'll keep you posted about this so if you can subscribe to the channel hit that bell so you be alerted about new videos as they come out leave a comment share it across social media and if you can support the page how do you do that you hit that super thanks button down below or head on over to Patreon and become a monthly yearly subscriber until the next episode S signing What's Going on With Shipping? 519K subscribers Videos About Twitter Facebook >NewNew Polar Bear Had an Anchor Fall Off \| Finland-Estonia Gas and Telecommunication Cables Severed by What's Going on With Shipping? Chinese Bulker Yi Peng 3 \| Sailed from Russia \| Accused of Severing Two Baltic Cables \| REVISED by What's Going on With Shipping? Tanker Eagle S Seized by Finland for Severing Cables Between Finland & Estonia \| Is it a Spy Ship? by What's Going on With Shipping? The Estonian Navy Halts a False Flagged 'Shadow Fleet' Tanker in the Baltic Sea Sailing to Russia by What's Going on With Shipping? Estonia Attempts to Stop a Russian Dark Fleet Vessel Flying No-Flag \| Jets Are Scrambled by What's Going on With Shipping?

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