Treasury Sanctions Entities for Transporting Oil Sold Above the Coalition Price Cap to Restrict Russia’s War Machine

Date issued: Oct. 12 2023

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TURBOFAC Commentary (915 words)

Notes:

1) This press release announces OFAC's first designations of non-U.S. persons for transactions related to dealings in Russian origin crude oil purchased above the "Price Cap" for such oil.

Several aspects of the designations make this an extremely usual action by OFAC.

First, note that the "price cap prohibitions" of EO 14071 do not have a "secondary sanctions" component. Now query whether, through use of the designation authority issued in March, 2022 that allows OFAC to target persons for "having operated in the marine sector of the Russian Federation economy," OFAC has signaled an intent to turn the primary sanctions prohibitions of the price cap into "quasi secondary sanctions". OFAC could, if it deemed fit, regard every shipping-related transaction that would constitute a violation of the price cap prohibition if engaged in by a U.S....