I haven't done a post on the Northern Sea Route for quite some time and how things have changed. The Russian-Ukraine war has really turned this trade route upside down as Putin wanted this route as his priority for trade route domination. The targets he bragged about have all fallen by the wayside along with the 3 brand new nuclear ice breakers which has now been reduced to only 1 as it is already being built.
Over the last few days new sanctions have hit with a 10th amendment now including the important Atomflot Ice Breakers along with Dubai based Sun Ship management. Sun Ship is a major shipping company transporting Russia's oil which is reportedly responsible for more than 70% of Russia's energy revenue. This is all in place to help reduce Russia's ability to fund the war in Ukraine.
Russia needs the Northern Sea Route more than ever as their two rail routes namely the Baikal-Amur known as BAM and the Trans Siberian Railway are operating at full capacity. The shipping sanctions will create more pressure as Lloyds Shipping Insurance does not cover these ships anymore so there is massive risks. Without having Lloyds backing you there is no sailing as what owner is prepared to lose their vessel and their clients cargo.
Any shipping company using the Northern Sea Route will now do so without having any insurance cover as the protector of shipping has cut ties with the region. Russia does not have the shipping capacity to export their energy products as this is a serious rug pull. It starts to make you wonder what took them so long to get this done as this is the tenth amendment.
Shipping has ground to a halt as even China have stopped using the route for the time being with so much economic uncertainty you don't need more enemies. With Europe not importing Russian energy the only choice is to look to the East which as a sea route is far longer than what would of been a quick trip to the West.
It is becoming more obvious why Putin needs Ukraine more than ever as he needs an ice free port in order to export. The countries who abstained in the vote against Russia's war with Ukraine were banking on receiving cheap energy and at this time looks like this may have just dried up for the time being. Countries like India who have partnered Russia in order to get their hands on cheaper LNG.
To round off not much has changed as we haven't missed much over the last 18 months or so. Russia has no trade to the West and is solely relying on the East and that cannot increase volumes due to the railways at full capacity along with the sea route being iced up. I read somewhere that a oil pipeline was on the cards from Russia to China, but this would take years to accomplish plus make a juicy fat target at the same time.