S&P Global — 22 January 2025
Daily Update: January 22, 2025
A Shadow Fleet Encounters the Harsh Light of Day
By Nathan Hunt
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Since the G7 Oil Price Cap Coalition countries established a price cap on Russian oil in late 2022 following the invasion of Ukraine, Russian oil interests have worked to circumvent it. These efforts include creating a shadow fleet of formerly Russian-owned and operated ships and tankers that continue to transport Russian crude and other sanctioned commodities under opaque ownership structures using flags of convenience.
S&P Global has been studying the structure and activities of the shadow fleet to understand the global trade in energy and commodities. Now, a new round of stringent sanctions has been announced against a specific list of named ships, traders, charterers and marine insurers. The sanctions come at a challenging time for Russian oil interests as Indian refiners had started to negotiate for March cargoes.
On January 10, US and UK officials announced a fresh package of sanctions on Russia's energy sector. Entities subject to tightened curbs include Gazprom Neft and Surgutneftegas, as well as more than 180 ships, dozens of oil traders, oilfield service providers, tanker owners and managers, insurance companies, and energy officials. At least 20 tankers with 16 million barrels of crude now moored or anchored are now on the sanctions list. With the new sanctions, the total number of ships on the US list exceeds 470.
“The effectiveness of these measures hinges on how long these sanctioned ships take to change ownership, get quickly reflagged, or get another class certificate to keep trading, as well as on the continued acceptance by the Indian and Chinese ports and refineries,” said Rahul Kapoor, head of shipping analytics and research at S&P Global Commodity Insights.
India has been a top market for Russian crude since the invasion of Ukraine began. In 2024, India imported 1.7 million b/d of Russian crude, according to data from S&P Global Commodities at Sea. Approximately 35% of India's total crude oil imports and 59% of its fuel oil imports in 2024 came from Russian sources, according to S&P Global Commodity Insights. Indian refiners are reportedly looking toward the Middle East and West Africa for incremental volumes to compensate for lost Russian crude.
Market observers noted the timing of the recent sanctions, shortly before the inauguration of President Donald Trump. “The decision to impose these sanctions at the end of the current US administration is certainly interesting. But the key question is what happens next. If President Trump seeks to end the Russia-Ukraine war, this will presumably result in a lifting of Russian sanctions as part of any agreement which could be bearish for oil,” Bernstein said in a recent research note.
Today is Wednesday, January 22, 2025, and here is today’s essential intelligence.
Sustainability and ESG Investments Will Keep Expanding Under Trump, Analysts Say
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—Read the article from S&P Global Market Intelligence
Subnational Government Outlook 2025: Anticipating a Year of Change
In 2025, S&P Global Ratings anticipates a relatively large number of countries outside the US will implement material changes in government financing systems to address imbalances between revenue sources and spending responsibilities of their respective local and regional governments (LRGs).
—Read the article from S&P Global Ratings
Performance Insights: The S&P 500 Equal Weight ESG Index
Since its launch in July 2022 to year-end 2024, the S&P 500® Equal Weight ESG Index achieved a cumulative outperformance of 0.86% compared to its benchmark, the S&P 500 Equal Weight Index. Gaining insight into the factors behind this outperformance highlights important aspects of environmental, social and governance (ESG) attributes that function differently from those in market-cap indices like the S&P 500 ESG Index.
—Read the article from S&P Dow Jones Indices
Nigeria Becomes BRICS Partner Country as Bloc Bids for Greater Role in Global Trade
Major African oil producer Nigeria has joined the BRICS partnership program, the foreign affairs ministry said in a statement Jan. 18, as BRICS aims to increase its role in global trade. The announcement came days before President-elect Donald Trump took office on Jan. 20. Trump has threatened to impose 100% tariffs on the BRICS countries if they proceed with plans to de-dollarize trade and establish a common currency.
—Read the article from S&P Global Commodity Insights
2025 Opens with Fire and Ice for US Refiners
US refiners have had a dramatic start to the new year, facing wintry blasts on the East Coast and devastating wildfires on the West Coast. Plummeting transportation fuel demand in Southern California, strong heating fuel demand in the Northeast and cheap blending components in the Gulf Coast have created a balancing act for producers and shippers of gasoline and distillates — and consumers pay the price.
—Listen and subscribe to the podcast from S&P Global Commodity Insights
January 2025 Light Vehicle Production Forecast
As we enter 2025, the global auto industry presents a landscape of mixed opportunities and challenges. Market dynamics are influenced by varying demand levels, regulatory changes and geopolitical factors. The propulsion mix is evolving, with some regions experiencing slower electric vehicle (EV) adoption while others show promising growth. The incoming Trump administration's anticipated revisions to US emissions standards are expected to significantly impact battery electric vehicle (BEV) production and market share.
—Read the article from S&P Global Mobility
Webinar: Global Credit Outlook 2025: Questions That Matter (Jan. 24, 2025)
S&P Global Ratings’ Global Credit Outlook 2025 presents its credit and macroeconomic outlooks for the year ahead, including its base-case forecasts, assumptions and key risks. At a time when key themes and risks appear to be increasingly interconnected, we invite you to explore the depth and breadth of expertise offered by S&P Global Ratings analysts and experts as we scan the horizon of what promises to be another challenging period for global markets.
—Register for the webinar from S&P Global Ratings