While Russia continues to evade sanctions, its key trading partners, particularly China and India, are also feeling the pressure from these restrictions.

Russia has turned to a network of 'shadow tankers' to transport oil, a strategy aimed at circumventing Western sanctions imposed to limit its oil revenue.

In December 2022, the UK, G7 countries, Australia, and the EU established a $60 per barrel price cap on Russian oil to restrict its trading capabilities.

Despite the price cap, shadow tankers have accounted for 89% of all Russian crude oil exports, indicating a significant loophole in the sanctions.

The volume of oil transported by these shadow tankers has surged, increasing from 2.4 million barrels per day in June 2023 to 4.1 million barrels per day by June 2024.

Experts warn that the reliance on aging shadow tankers, which average 18 years in age and often lack adequate insurance, poses severe environmental risks.

The Biden administration is divided on whether to enforce the price cap more aggressively, with concerns about potential disruptions to oil supply.

Several accidents involving these tankers, including a notable collision near Denmark in March 2024, have raised alarms about their safety.

Western allies face challenges in isolating Russia's economy effectively, as many shipments continue to be sold above the price cap.

Russia has invested approximately $10 billion in developing its shadow fleet, which now plays a crucial role in its oil exports.

Maintaining this shadow fleet is costly, with estimates ranging from $8 billion to $10 billion, making it essential for the Russian government to protect this investment.

In response to the ongoing challenges, the U.S. and its allies are prioritizing the enforcement of sanctions against the shadow fleet to curb Russia's oil revenue.