Russia shadow fleet king Gatik sinks on paper, transfers all tankers to related companies

Shipping industry experts see the move as an attempt by Gatik’s benefactors to make tracking of the entire operation difficult and keeping the activity opaque. According to The Indian Express’s analysis of changes in Gatik’s fleet, the company distributed the commercial management of at least 48 of its tankers over the past few months among 43 other firms, most of which seem to be related to Gatik. However, there was no change in effective ownership of the ships as registered owners continue to remain the same in almost all cases. Interestingly, commercial management was transferred to the respective registered owners in the majority of the cases.

This follows a series of actions by international insurers, shipping registries, and maritime classification societies against Gatik. These actions are likely to have stemmed from apprehensions that Gatik’s vessels might have been involved in hauling Russian oil sold above the West’s $60-per-barrel price cap.

While Gatik’s name might have been erased from the tankers’ paperwork, they continue to be deeply involved in Russia’s oil trade with India, shows an analysis of recent port call data of the ships. Of the 48 vessels, which include 30 oil tankers and 18 petroleum product tankers, 15 oil tankers made stops at Indian ports like Paradip, Vadinar, Sikka, Visakhapatnam, Kochi, and Mangalore over the past six to eight weeks. These ports serve as the crude oil unloading points to feed some of the major refineries in India. Many of these tankers also had recent port calls at Russian ports.

Apart from Russia and India, geographies where the vessels operated included Turkey, Egypt, China, Saudi Arabia, Singapore, Indonesia, Malaysia, and South Korea, among others, the port call data shows.

From being a marginal supplier of crude oil to India before the war in Ukraine, Russia is now New Delhi’s largest source of crude, having displaced traditional heavyweights like Iraq and Saudi Arabia. The surge in India’s import of Russian oil was driven by discounts being offered by Moscow after the traditional Western buyers started shunning Russian oil over its invasion of Ukraine.

The people behind Gatik and the web of related shipping companies remain shrouded in mystery. In the maritime industry, vessel ownership structures can be extremely opaque, which often renders it impossible to trace the actual owner of a ship and the people behind shippers such as Gatik. International trade sources suggest that Gatik is an arm of Buena Vista Shipping (BVS), and could have close links to a shipper in the United Arab Emirates and Russian oil companies. Shipping databases list an office in Neptune Magnet Mall in Mumbai’s Bhandup as the address of Gatik as well as BVS. The address of many of the companies to which Gatik’s vessels have been transferred is listed as “care of Gatik”, featuring the same Bhandup office. Interestingly, the office has been vacant for months now. BVS has not been responding to queries about its relationship with Gatik and the latter’s role in global flows of Russian oil.

There are various ownership-related categories in the maritime industry, including commercial managers, registered owners, and beneficial owners. Put simply, the commercial manager is the effective manager of the fleet and responsible for the commercial decisions pertaining to the vessels. The registered owner of the vessel is the company in whose name the vessel is registered in an international shipping registry. Often, registered owners are located in offshore safe havens for tax-related purposes and to maintain secrecy. The beneficial owner is the ultimate owner of a vessel but its name is often buried deep under layers of inter-connected offshore companies.

The European Union’s import ban and the West’s $60-per-barrel price cap on Russian crude took effect in early December 2022, making the transportation of Russian oil murkier. The price cap prohibits Western shippers and insurers from getting involved in trade of Russian oil if it trades above $60 per barrel. With the price cap coming into play, activities like ship-to-ship (STS) transfers of sanctioned Russian oil and other dark activity, which refers to a ship’s activity and movement when it is not traceable on the global automatic identification system, have reportedly shot up over the past few months.