Russia is preparing to launch a state-backed insurance company to cover oil and commodity exports along the Northern Sea Route, as Western sanctions continue to isolate its shipping and reinsurance sectors. The initiative, confirmed by several Russian media outlets including Izvestia and Neftegaz, is being developed with support from the Ministry of Finance and the Bank of Russia.
According to Energy Intelligence, the planned insurer would underwrite vessels transporting crude, LNG and other raw materials through the Arctic corridor to Asia, providing coverage where international reinsurers have withdrawn.
The firm would likely operate alongside the Russian National Reinsurance Company, which has handled sanction-exposed risks since 2016 but faces limits on capital and international recognition.
Officials familiar with the discussions said the new entity would centralize underwriting for Arctic shipping, including tankers serving Novatek’s LNG terminals and Rosneft’s northern oil projects. The move aligns with Moscow’s goal to expand the Northern Sea Route’s freight capacity to more than 200 million tonnes by 2030 and to make it a year-round export channel.
The route’s current throughput remains modest compared to its ambitions. Russia itself reports about 37.9 million tonnes shipped in 2024 via the Northern Sea Route. Yet government and industry plans project cargo flows in a wide range, from roughly 224 million tonnes in a baseline case to as much as 270 million tonnes by 2030-2035.
Russian business outlets suggest the proposal emerged after several Asian insurers declined to renew policies on tankers linked to sanctioned operators, forcing Moscow to seek a domestic safety net. The policy structure remains under review but would effectively replace Western reinsurance layers for Arctic shipments.
The plan follows years of heavy reliance on older, opaque vessels now known as Russia’s “shadow fleet,” which continue to carry sanctioned crude with limited transparency. Russian media report the insurance framework could be formalized before the end of this year in order to coincide with the next phase of Arctic tanker fleet expansion.
By Charles Kennedy for Oilprice.com
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