Oil Price Cap Countries to Require Per-Voyage Attestations

The countries behind the Russian oil price cap on Feb. 16 released changes to the cap's attestation model in a bid to "strengthen the compliance regime and reduce routes for circumvention," the U.K.'s Office of Financial Sanctions Implementation announced. The changes require per-voyage attestations and itemized ancillary cost information on request.

An "attestation" is a document showing the price information of the Russian oil being delivered and the "Unit Price of the Russian oil," while also "attesting that the Unit Price" is or will be at or below the price cap and showing that the Russian oil was bought "pursuant to a license."

A "Tier 1" provider is a service provider that can directly access the unit price of the Russian oil. A "Tier 2" provider is one that directly interacts with parties with price information and can request the unit price. "Tier 3A" and "Tier 3B" providers don't have direct access to price information. Tier 3A providers include cargo insurers, flagging registries, hull and machinery insurers, shipowners and insurance brokers, while 3B providers are reinsurers, reinsurance brokers and financial institutions "providing general financing facilities."

To reflect the changes, OFSI issued a new general license permitting the trade of Russian oil under the price cap. The license said Tier 1 providers that supply or deliver Russian oil by ship from Russia to a third country must "provide an "Attestation prior to lifting/loading the oil or the effective date of the contract (whichever is earlier)."

A Tier 2 provider working with a Tier 1 provider to supply Russian oil "must request additional Attestations for every relevant Voyage prior to lifting/loading the oil" if more than one voyage occurs under a single contract. Tier 2 providers also must not proceed with its contract if the Tier 1 provider "does not comply" within five working days of a request for additional attestations.

Tier 2 providers also must provide attestations prior to loading the oil and prior to the effective date of the contract. If more than one voyage occurs under a single contract, the Tier 2 provider must give additional attestations for every relevant voyage within 28 days of loading the oil.

Tier 3A and 3B providers must request and be in possession of an attestation and on request provide an attestation. Tier 3A providers working with all providers, save Tier 3B providers, "must require that additional Attestations" be provided for all relevant voyages, while Tier 3A providers working with Tier 3B providers must provide an attestation prior to the date of the contract.