An EU/UK plan to ban their insurers from providing cover to ships transporting Russian oil is causing tensions with Washington. America contends that Europe’s dominance of global insurance will make it very difficult for Russia to export oil if this goes ahead, potentially pushing oil prices far higher than they are already.
Yet this may not happen, because Russia is making moves to overcome the problem itself. The nation’s state reinsurance company, RNRC, is reportedly stepping in to take the place of western insurance companies by insuring fleets and their cargo. Russia will also now provide third-party liability and environmental damage cover in place of protection and indemnity (P&I) clubs. If these changes are viable for the long term, it will mean that a chunk of business that used to mostly go to European and British insurance companies will now be kept in Russia.
