Treasury Department’s hunt for Russian oil sanction violators on the seas is intensifying
A Russian-chartered oil tanker in the sea off Morocco in an area identified by maritime technology company Windward as a hub for smuggling oil.
Europa Press | Getty Images
The U.S. Department of the Treasury’s Office of Foreign Assets Control announced three vessels and shipping companies being sanctioned for violating the Russian oil sanctions on Thursday, only a few days after Treasury began a separate, larger probe of approximately 30 ship management companies covering 100 vessels suspected of violating a price cap on Russian oil.
“Shipping companies and vessels participating in the Russian oil trade while using Price Cap Coalition service providers should fully understand that we will hold them accountable for compliance,” said Deputy Secretary of the Treasury Wally Adeyemo in a statement on Thursday. “We are committed to maintaining market stability in spite of Russia’s war against Ukraine, while cutting into the profits the Kremlin is using to fund its illegal war and remaining unyielding in our pursuit of those facilitating evasion of the price cap.”
But as the Treasury seeks to cut off the Kremlin’s access to oil profits, its hunt for crude tankers and shippers violating OFAC guidelines is revealing complexities in its own guidelines and a murky marine industry.
The shipping entities identified on Thursday were United Arab Emirates-based. The vessels were Kazan Shipping Incorporated’s Kazan, Progress Shipping Company Limited’s Ligovsky Prospect, and Gallion Navigation Incorporated’s NS Century. But while those ships are now UAE-based, Matthew Wright, lead analyst of freight at marine intelligence firm Kpler, tells CNBC the location of where the company is based may be different from the location of the beneficial owner. In this case, Wright says the beneficial owner is likely still Russian-based.
“Based on the history of these fleets, these vessels were all owned and operated by Sovcomflot,” Wright said. “Management of all the Sovcomflot ships was transferred to Sun Ship Management in March/April 2022 when their offices in Europe were closed. Those three companies are now managed by a new manager called Oil Tankers SCF Management but it’s just another name. Ownership hasn’t changed since 2006. They’re not part of either the dark or grey fleet really as I consider them still Russian-owned.”
30 ship owners targeted in new Treasury probe
This is just one example of the murkiness within the Russian oil trade. The probe against 30 shipowners begun earlier this week reveals how identifying and finding proof of vessels traversing the oceans with sanctioned oil is not as straightforward as suggested by initial headlines covering the Treasury allegations. These companies received warning letters from the government about activity deemed suspicious and requests for documentation. There are grey areas in the U.S. government’s Russian oil guidelines, though the efforts can ultimately lead maritime investigators to the truth.
In the U.S. Treasury’s “Preliminary Guidance on Implementation of a Maritime Services Policy and Related Price Exception for Seaborne Russian Oil,” ship owners are under a Tier 2 category. According to the Treasury, this group within the maritime industry are “actors who are sometimes able to request and receive price information from their customers in the ordinary course of business.”
If a ship owner is unable to obtain such pricing information, according to the Treasury’s guidelines, the Tier 2 actors (ship owners) need to request “customer attestations” where their charter customers pledge in a document they will not purchase seaborn Russian oil above the price cap.
This document could provide a “safe harbor” for ship owners who are relying on that customer’s “attestation” to comply with sanctions. This safe harbor is also extended to the ship insurance companies.
“Ship owners rely on the charterer to provide ample proof that the Russian oil on board the vessel has been sold below the price cap,” said Andy Lipow, president of Lipow Oil Associates. “The sanctions can easily be circumvented if a dishonest charterer presents documents that falsify the true cost of the oil.”
Lipow said one clue to suspicious paperwork is a price of oil that is well below the market, selling Russian crude oil in Asia today at $50 per barrel when Brent is trading at $80.
“That is a red flag,” Lipow said.
Based on the safe harbor, if the ship owner or management company can be absolved of wrongdoing, the documents can still lead Treasury to the charterer.
The U.S. Treasury told CNBC it does not comment on current investigations.
Tracking Russian oil
A breakout of the Russian oil trade by Kpler shows around 30% of Russian exports from Western ports are still using commercial shipping with beneficial ownership within the European Union.
Wright said this “dark fleet” is comprised of vessels typically 20 years and older which have loaded or predominantly loaded Venezuelan or Iranian cargoes in the last few years.
“There is often some evidence that they have been disguising their activities by turning off their AIS, but not in all cases,” said Wright, referring to the automatic identification system used by marine vessels to track location. “Ownership is often opaque and the operator does not engage in standard commercial shipping outside of operating these vessels.”
There are also “grey fleet” vessels sold since the Russian invasion of Ukraine with the aim of transporting Russian exports and avoiding sanctions. These vessels, according to Wright, have had EU ownership.
“Most vessels have been sold by owners based in Europe to owners who were not previously active in the tanker market,” he said. “The owners are based mainly in Hong Kong, China, India, and the UAE.”
The price cap rules state that exports of Russian crude or refined products on EU-owned, insured, or serviced tonnage must be below the relevant price cap.
Since July, Wright says most exports from Russia are assumed to be above the caps, yet a large number of ships from within the EU continue to trade. This is because of the way Russian crude is traded.
“It is very likely vessels loading Russian cargoes that are EU-owned will have documentation showing a crude trade below the price cap, even if the cargo was actually traded above the price cap,” Wright said. “This is because a charterer or middleman will have traded it at a price that can be shown to the owner as part of a wider trade with the final buyer. The (vessel) owner is unlikely to have any evidence to the contrary.”
Vessel owners do not produce these documents, he said, but are provided with these documents by the charterer.
“The vessel owners are merely the custodians of information provided to them,” Wright said.
Beks Shipmanagement & Trading confirmed to CNBC it is among the companies that received warning letters from the Treasury this week and is sending documents to the government. The company had been identified in earlier press reports, though Treasury declined to specify companies to receive letters.
In an email to CNBC, the company rejected the Treasury’s allegations. “Despite the fact that the U.S. Treasury Department requested voyage details from 30 different ship management including 100 vessels, it is an obvious bad faith and reputation damaging purpose that only our management company was mentioned in the news recently circulated in the media,” a Beks spokesperson wrote.
The company, based in Turkey, announced in October the deployment of SpaceX’s Starlink satellite connectivity system across its fleet of 40 bulkers and tankers for enhanced vessel tracking.
“Our vessels are traded worldwide with their tracking system always switched to the on position. We employ our vessels by abiding (by) all international laws and regulations without breaching any sanction regime,” the company wrote in the email.
Beks said it has been conducting due diligence procedures on all of its voyages as well as carrying out the necessary sanction checks with its London-based lawyers.
According to Kpler, Beks Shipmanagement’s fleet had numerous tanker port calls to Russia since the start of sanctions on February 24, 2022. One example is the oil products tanker Bek Aqua.
Kpler was able to track the travel of the tanker using the tanker’s satellite beacons through the AIS short-range coastal tracking system currently used on ships.
The tanker Beks Aqua arrived at the Russian Port of Nakhodka on Oct 26 and was loaded with either diesel or Naptha on November 1. The vessel then arrived at the Port of Singapore on November 10 and departed empty on November 14.
But following the satellite data doesn’t allow for understanding of contract prices.
“While we can track the vessel’s journey from Russia to Singapore, unless we have the sales contract, we do not know the price the oil product was purchased for,” Lipow said. “The only fact we have is companies like Beks Shipping are employed to move Russian oil. It is possible that someone filed false paperwork with the shipowner. This is why tracking the Russian oil sanctions is not straightforward,” he said.
Beks Shipmanagement said the requested voyage details will be provided to the U.S. Treasury with full transparency.
Porsche’s long-awaited Macan EV will finally hit US dealers on September 30th, and we’ve also just learned that it will have an EPA-certified range of 308 miles, or 288 for the “Turbo” version.
We’ve been waiting what seems like forever for the Porsche Macan to come out – Seth even got to go see it in Germany last October – and now the car is finally (almost) here, arriving later this month in US dealers.
Porsche told us that the ships carrying the cars are en route, and depending on which coast you’re on, they should arrive in the last week or two of this month. But Porsche and its dealers have been communicating the Sept 30th date for Macan availability – so if you’re looking forward to this car, you’ve only got a couple weeks to get your affairs in order (you can use our affiliate link to contact local dealers and get in line).
And today we’ve learned one of the final steps before getting these cars on the road has been submitted, as the Macan EV has been officially rated at 308 miles EPA range, or 288 miles for the Turbo. These numbers are lower than the European 381-mile WLTP range, but WLTP ranges are always higher due to different testing protocols.
So we expected a range of around 300 miles for the Macan EV, and that’s what we got. Though Porsche also told us that range will be “10-15% higher in real world.”
These range numbers translate to an MPGe rating of 98, or 91 MPGe for the Turbo version. Both of these numbers are higher than any Taycan efficiency numbers, which is somewhat incongruous given the Macan is a larger vehicle.
When the Taycan came out, it had pretty low EPA-rated range/efficiency numbers, but it turned out those estimates were highly conservative and that Porsche voluntarily lowered its numbers in order to “underpromise and overdeliver.” So it looks like Porsche is looking to do the same thing again here.
However, other preliminary US reviews we’ve seen showed the Macan having high-200s mile range. We haven’t had a chance to do a range test on the Macan ourselves, yet, so we can’t confirm those numbers.
So, as usual, “your mileage may vary,” but it looks like the car will have more than enough range for buyers.
It’s also capable of 270kW charging, which Porsche says will allow it to charge from 10-80% in 21 minutes. This is plenty quick enough to fill up at a lunch stop, long bathroom + stretch break, or whatever else, and get you back on the road without significant delay.
In this day and age, quick charging speeds is really the more important thing to focus on anyway, and there are big changes on the horizon in that respect, with Porsche committing to NACS connectors in 2025.
However, despite the Macan EV being a 2025 model, it will retain the previous SAE CCS port, and will not use the NACS part for the foreseeable future. So you’ll have to stay tuned for more updates in that respect, including potential adapter availability (Porsche is currently not on Tesla’s NACS “coming soon” page, and the NACS rollout has been slowed by Supercharging chaos caused by Tesla CEO Elon Musk’s impromptu firing of the entire Supercharger team).
If our coverage of EVs has been helpful to you, you can use our affiliate link to contact your local dealers about the 2025 Porsche Macan, and ask them to put you in line for the Macan EV when it shows up at the end of this month.
Hydrogen-electric plane developer ZeroAvia has completed another successful financing round, led by some of its previous investors and some new ones. The sustainable aviation specialist plans to use the fresh funds to expedite the certification of its first powertrain and support selling its in-house components to other electrified aviation OEMs.
ZeroAvia has tasked itself with delivering 40—to 80-seat aircraft with up to 700 miles of range by 2027. So far, its sustainable technology has amassed some heavy hitters’ interest (and funding) in the segment to help push development forward.
In 2022, ZeroAvia secured over $30 million in funding, including investments from American Airlines, which joined Alaska Airlines and United in the hydrogen-electric plane venture.
2023 included several new partnerships and a fresh round of funding led by Airbus, Barclays, and Saudi Arabia’s “living laboratory,” NEOM. In late November, ZeroAvia announced a deal to provide up to 70 zero-emission planes to sustainable startup airline EcoJet, which looks to become the world’s first all-electric airline.
This past July, American Airlines committed to a large purchase of zero-emissions engines alongside a fresh investment in the aviation startup’s technology as part of a Series C fundraising round. Today, ZeroAvia announced it has extended upon that Series C round, which has now been completed for a total of $150 million.
ZeroAvia adds more names to its investment rolodex
The sustainable aviation company shared details of its extended financing round today. This included a 20 million euro £20m (23.7M euros) investment from the Scottish National Investment Bank, aka “The Bank,” which joins other investors like American Airlines, International Airlines Group (IAG), and ITOCHU Corporation.
ZeroAvia shared that the round was co-led by Airbus, Barclays Sustainable Impact Capital, and the NEOM Investment Fund (NIF). UK Infrastructure Bank joined as a cornerstone-level investor, and existing shareholders like Breakthrough Energy Ventures, Horizons Ventures, Ecosystem Integrity Fund, Summa Equity, Alaska Airlines, Amazon’s Climate Pledge Fund, and AP Ventures also participated.
The funding will enable the aviation startup to accelerate its progress toward certifying its first hydrogen-electric plane powertrain for commercial operations. Per ZeroAvia founder and CEO, Val Miftakhov:
We have closed an exceptionally strong financing round to help us deliver the clean future of flight for the entirety of aviation. As a purpose–driven impact investor, the Bank is an ideal partner for ZeroAvia. Scotland’s ambitious net zero targets, its strategic focus on hydrogen and its strong existing aerospace skills base make it an attractive place for ZeroAvia’s UK production operations as we scale into a major aerospace manufacturer.
In addition to locking in flight certification, ZeroAvia says the $150M in funding will help it begin sales of its in-house aviation technology, including electric motors and fuel cell power generation systems, to other companies.
ZeroAvia has already flight-tested a prototype of its first ZA600 engine, implemented aboard a Dornier 228 aircraft at its UK base, and its application for certification with the CAA is already underway. Additionally, the company has completed advanced ground tests in the US and UK of its ZA2000 system, which can someday help sustainably propel 80-seat regional turboprop aircraft.
That larger and more advanced propulsion system includes cryogenic tanks for LH2 and proprietary high-temperature PEM fuel cell and electric systems.
Tesla’s rollout of Full Self-Driving v12.5 has failed so far, and owners want to know what happens next?
In 2016, Elon Musk announced that all future Tesla vehicles would come equipped with the necessary hardware for self-driving capabilities, even specifying “level 5 self-driving,” which implies the ability to operate autonomously under any conditions. However, shortly after, Musk acknowledged that Tesla might require more onboard computing power than initially thought, leading to the introduction of Hardware 3 (HW3).
Musk assured that HW3 would enable full self-driving (FSD) capabilities, promising retrofits for earlier models that had purchased the FSD package. Following this, Tesla introduced Hardware 4 (HW4), a more advanced onboard computer system, but did not offer retrofits for older models with HW3, maintaining that HW3 was sufficient for achieving self-driving through software updates.
Initially, Musk claimed that FSD improvements would first be optimized for HW3, suggesting that HW4 might lag behind by at least six months. However, Tesla reversed this approach with the release of FSD version 12.5, which was first deployed to HW4 vehicles. Musk explained that optimizing the software for the less powerful HW3 would take additional time, hinting at the limitations of HW3 in handling the latest software advancements towards unsupervised self-driving, a capability Tesla promised to HW3 owners since 2016.
This rewrite aims to streamline the narrative, focusing on the evolution of Tesla’s self-driving hardware and software, and the strategic shifts in deployment and optimization of FSD capabilities between HW3 and HW4.
Musk said that it would take ten days to adapt v12.5 to HW3.
In late August, about two weeks after Musk’s “10 days” had passed, we reported that Tesla started to push v12.5 to HW3 vehicles.
Not only was the update to HW3 late, but Tesla also confirmed that it was running a smaller model than on HW4.
On top of all that, now three weeks later, Tesla has yet to push v12.5 to the vast majority of FSD vehicles with HW3. Tesla appears to only have pushed v12.5.1.5 to some Tesla HW3 owners and it is now moving HW4 cars to v12.5.2.
Social media and Tesla forums are full of Tesla HW3 owners asking why they haven’t released a new update since v12.3.6 earlier this year despite Musk’s comments.
In its “AI roadmap” released last week, Tesla now claims that HW3 will get the same release as HW4 starting with v12.5.2 this month.
However, v12.5.2 is already in the consumer fleet for HW4 cars and v12.5.3 is already being tested in the beta fleet.
Electrek’s Take
This article is mainly to correct our article from last month that claimed Tesla was pushing v12.5 to HW3 since it turned out to be a very limited release.
Earlier this year, Elon said that Tesla was not compute-constrained for training FSD anymore. He also claimed that the training compute combined with v12’s full end-to-end neural nets would enable much faster software improvements.
And yet, the vast majority of HW3 owners have only received v12.3.6 this year.
That, combined with the fact that Tesla’s AI roadmap makes no mention of unsupervised self-driving whatsoever, and Tesla seemingly stopped promising it on new cars, has completely killed my hopes of Tesla delivering on its self-driving promises on HW3 cars and it has greatly limited by hopes of the same for HW4 cars.
I wouldn’t be shocked if Tesla fully shifts its self-driving strategy to the dedicated robotaxi, but I have no idea how they plan to make HW3 and possibly HW4 owners whole.
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